HomeMy WebLinkAboutCity of Lansing CAFR Comprehansive Annual Financial Report FY2017 City
of Lansing, .�
Michigan
Year Ended Comprehensive
June 30, 2017 1 Annual Financial
Report
. •
Prepared by: Department of Finance
Finance Director
Angela Bennett
Accounting Manager
Randy Endsley
CITY OF LANSING, MICHIGAN
Table of Contents
Page
INTRODUCTORY SECTION 1
Elected and Appointed Officers 2
Letter of Transmittal 3
Table of Organization 7
GFOA Certificate of Achievement 8
FINANCIAL SECTION 9
Independent Auditors' Report 11
Management's Discussion and Analysis 15
Basic Financial Statements
Government-wide Financial Statements:
Statement of Net Position 30
Statement of Activities 31
Fund Financial Statements:
Balance Sheet - Governmental Funds 36
Reconciliation of Fund Balances of Governmental Funds
to Net Position of Governmental Activities 37
Statement of Revenues, Expenditures and Changes in Fund Balances -
Governmental Funds 38
Reconciliation of Net Changes in Fund Balances of Governmental Funds
to Change in Net Position of Governmental Activities 39
Statement of Revenues, Expenditures and Change in
Fund Balance - Budget and Actual:
General Fund 40
Statement of Net Position - Proprietary Funds 44
Statement of Revenues, Expenses and Changes in Fund Net
Position - Proprietary Funds 45
Statement of Cash Flows - Proprietary Funds 46
Statement of Fiduciary Net Position - Fiduciary Funds 50
Statement of Changes in Fiduciary Net Position - Pension and
Other Postemployment Benefits Trust Funds 51
Combining Statement of Net Position - Discretely Presented Component Units 56
Combining Statement of Activities - Discretely Presented Component Units 57
Notes to Financial Statements 59
CITY OF LANSING, MICHIGAN
Table of Contents
Page
Required Supplementary Information 119
Employees' Retirement System Pension Plan:
Schedule of Changes in Net Pension Liability and Related Ratios 120
Schedule of the Net Pension Liability 121
Schedule of Contributions 122
Schedule of Investment Returns 123
Police and Fire Retirement System Pension Plan:
Schedule of Changes in Net Pension Liability and Related Ratios 124
Schedule of the Net Pension Liability 125
Schedule of Contributions 126
Schedule of Investment Returns 127
Employees' Retirement System OPEB Plan:
Schedule of Changes in Net OPEB Liability and Related Ratios 128
Schedule of the Net OPEB Liability 129
Schedule of Contributions 130
Schedule of Investment Returns 131
Police and Fire Retirement System OPEB Plan:
Schedule of Changes in Net OPEB Liability and Related Ratios 132
Schedule of the Net OPEB Liability 133
Schedule of Contributions 134
Schedule of Investment Returns 135
Combining and Individual Fund Financial Statements and Schedules 137
Nonmajor Governmental Funds:
Combining Balance Sheet - Nonmajor Governmental Funds 138
Combining Statement of Revenues, Expenditures and Changes in Fund
Balances - Nonmajor Governmental Funds 139
Combining Balance Sheet - Nonmajor Special Revenue Funds 142
Combining Statement of Revenues, Expenditures and Changes in Fund
Balances - Nonmajor Special Revenue Funds 144
Schedule of Revenues, Expenditures and Changes in Fund
Balances - Budget and Actual - Nonmajor Special Revenue Funds 146
Combining Balance Sheet - Nonmajor Debt Service Funds 154
Combining Statement of Revenues, Expenditures and Changes in Fund
Balances - Nonmajor Debt Service Funds 155
Combining Balance Sheet - Nonmajor Capital Projects Funds 158
Combining Statement of Revenues, Expenditures and Changes in Fund
Balances - Nonmajor Capital Projects Funds 159
Combining Balance Sheet - Nonmajor Permanent Funds 162
Combining Statement of Revenues, Expenditures and Changes in Fund
Balances - Nonmajor Permanent Funds 163
CITY OF LANSING, MICHIGAN
Table of Contents
Page
Combining and Individual Fund Financial Statements and Schedules (concluded)
Nonmajor Enterprise Funds:
Combining Statement of Net Position - Nonmajor Enterprise Funds 166
Combining Statement of Revenues, Expenses and Changes in Fund Net
Position - Nonmajor Enterprise Funds 167
Combining Statement of Cash Flows - Nonmajor Enterprise Funds 168
Internal Service Funds:
Combining Statement of Net Position - Internal Service Funds 172
Combining Statement of Revenues, Expenses and Changes in Fund Net
Position - Internal Service Funds 173
Combining Statement of Cash Flows - Internal Service Funds 174
Agency Funds:
Combining Statement of Fiduciary Assets and Liabilities - Agency Funds 178
Combining Statement of Changes in Fiduciary Assets and Liabilities - Agency Funds 179
STATISTICAL SECTION (UNAUDITED) 181
TABLE
1 Net Position by Component 185
2 Change in Net Position 186
3 Fund Balances, Governmental Funds 188
4 Changes in Fund Balances of Governmental Funds 189
5 Assessed and Estimated Actual Value of Taxable Property 190
6 Direct and Overlapping Property Tax Rates 191
7 Profile of Ten Largest Ad Valorem Taxpayers 192
8 Property Tax Levies and Collections 193
9 Ratios of Outstanding Debt by Type 194
10 Ratios of General Bonded Debt Outstanding 195
11 Direct and Overlapping Governmental Activities Debt 196
12 Legal Debt Margin Information 197
13 Pledged-Revenue Coverage 198
14 Demographic and Economic Statistics 199
15 Principal Employers 200
16 Full-Time Equivalent City Governmental Employees by Function/Program 202
17 Operating Indicators by Function/Program 206
18 Capital Asset Statistics by Function/Program 208
INTRODUCTORY SECTION
1
CITY OF LANSING, MICHIGAN
LANSING CITY GOVERNMENT
Fiscal Year July 1, 2016 - June 30, 2017
MAYOR
Virg Bernero
CITY COUNCIL
Judi Brown Clarke, Council President, At Large
Jessica Yorko, Council Vice President, 4th Ward
Kathy Dunbar, At Large
Patricia Spitzley, At Large
Carol Wood, At Large
Jody Washington, 1st Ward
Tina Houghton, 2nd Ward
Adam Hussain, 3rd Ward
CLERK
Chris Swope
DISTRICT COURT JUDGES
Louise Alderson, Chief Judge
Frank J. Deluca
Patrick F. Cherry
Hugh B. Clarke, Jr.
OFFICERS
Randy Hannan Executive Assistant/Chief of Staff
Chad A. Gamble Chief Operating Officer/Public Service Director
James D. Smiertka City Attorney
Angela Bennett Finance Director
Tammy Good City Treasurer
Michael Yankowski Police Chief
Randy Talifarro Fire Chief
Bob Johnson Planning Et Neighborhood Development Director
Brett Kaschinske Parks Et Recreation Director
Anethia Brewer Court Administrator
Joan Jackson Johnson Human Relations Et Community Services Director
Mary Riley Human Resources Director
Eric Brewer Internal Auditor
2
FINANCE DEPARTMENT
124 W. Michigan Ave., 8'Floor
Lansing: Michigan 48933
(51 Tj 4834500
J HlC ®
December 22, 2017
Council President Patricia Spitzley
and Council Members
10th Floor City Hall
Lansing, Michigan 48933-1694
Dear President Spitzley and Council Members:
We are pleased to submit the comprehensive annual financial report of the City of Lansing, Michigan for the
fiscal year ended June 30, 2017.
The City assumes full responsibility for both the accuracy of the data and the completeness and fairness of
the presentation, including all disclosures. To the best of our knowledge and belief, the enclosed data are
accurate in all material respects and are reported in a manner designed to present fairly the financial
position and results of operations government wide and of the various funds of the City. All disclosures
necessary to enable the reader to gain an understanding of the City's financial activities have been included.
The City's fiscal year 2016/2017 financial statements have been audited by Rehmann Robson, an independent
firm of licensed, certified public accountants. The goal of the independent audit is to provide reasonable
assurance that the financial statements for the City of Lansing for the fiscal year-ended June 30, 2017, are
free of material misstatement. The independent audit involved examining, on a test basis, evidence
supporting the amounts and disclosures contained in the financial statements; assessing the accounting
principles used; and evaluating the overall financial statement presentation. The independent audit
concluded with the rendering of an unmodified opinion on the statements, meaning the financial statements
present, fairly and accurately in all material respects, the financial position of the City in conformity with
Generally Accepted Accounting Principles ("GAAP"). The independent auditors repot is presented as the first
component of the financial section of this report.
This letter of transmittal is designed to complement the Management Discussion and Analysis (MDEtA) and
should be read in conjunction with it. The Management Discussion and Analysis can be found immediately
following the Independent Auditor Report.
Profile of the City of Lansing
Serving as Michigan's capital since 1848, the City of Lansing was incorporated in 1859 and operates under
provisions of Public Act 279 of 1909, as amended (the "Home Rule City Act"). The City incorporates 34.7
square miles and is located in the lower middle of Michigan's Lower Peninsula and operates under a strong
mayor form of government established by 1978 Charter revision.
3
Lansing is a mature core city with a population of 116,020, according to 2017 census estimates, and offers a
full range of services. During the fiscal year ended June 30, 2016, the City operated police headquarters and
a precinct with over 190 sworn police officers; six fire stations with a fire protection force of over 170; over
350 miles of sanitary sewers, 230 miles of storm sewers, and 180 miles of combined sewers; over 400 miles of
roads; 113 parks; a District Court; and support for human services and cultural events. The City's main
sources of revenue are property taxes, income taxes, State revenue sharing, Federal entitlement grants, and
charges for services, including utility billings.
Reporting Entity
The financial reporting entity (the City) includes all of the funds and of the primary government (i.e., the
City as legally defined), as well as its blended component units. Blended component units, although legally
separate entities, are, in substance, part of the primary government's operations and are included as part of
the primary government. The Lansing Building Authority is a blended component unit. Discretely presented
component units are reported in a separate column in the combined financial statements to emphasize that
they are legally separate from the primary government and to differentiate their financial position, results of
operations and cash flows from those of the primary government. The Lansing Entertainment Et Public
Facilities Authority, Tax Increment Finance Authority, Brownfield Redevelopment Authority, and Smart Zone
are reported as a discretely presented component units.
Financial Management and Control
Management of the City of Lansing is responsible for establishing and maintaining internal controls designed
to ensure that the assets of the government are protected from loss, theft, or misuse and to assure that
adequate accounting data is compiled to allow for the accurate presentation of financial statements in
conformity with generally accepted accounting principles.
To provide a reasonable basis for making these presentations, management has established a comprehensive
system of internal controls designed to reasonably ensure that assets of the City are protected from loss,
theft or misuse and to ensure that adequate accounting data are compiled to allow for the preparation of
these financial statements in conformity with generally accepted accounting principles. Such controls
include appropriate policies and procedures, ongoing risk assessment, and monitoring and review processes
which are communicated throughout City operations. Because the cost of internal controls generally should
not outweigh their benefits, the City's framework of internal controls has been designed to provide
reasonable, rather than absolute, assurance that these objectives are met.
Because the City is a recipient of federal grant dollars, the independent audit of the financial statements of
the City of Lansing was part of a broader, federally-mandated "single audit" in conformity with the
provisions of the Single Audit Act of 1996 and the U.S. Office of Management and Budget Circular A-133,
Audits of States. Local Governments, and Non-profit Organizations. The standards governing the single audits
require the independent auditor to report not only on the fair presentation of the financial statements, but
also on the audited government's internal controls and compliance with legal requirements involving the
administration of the federal awards. These reports are available in the City's separately-issued Single Audit
Report.
Financial results and applicable policies affecting year-end results for the fiscal year-ended June 30, 2017
are discussed in the Management Discussion and Analysis (MDEtA), located immediately following the
Independent Auditor Report.
4
Budgeting Controls
The annual budget serves as the foundation for the City's financial planning, policy-making, and control. The
City Charter requires that the Mayor submit to the City Council a proposed budget by the fourth Monday in
March. Budgetary controls and limitations are noted in the Note Disclosure Section of the financial
statements.
The City also maintains an encumbrance accounting system, whereby purchase orders amounts are deducted
from the available budget, as one technique of accomplishing budgetary control. Encumbered amounts lapse
at year end and require Council approval to be carried forward to the ensuing fiscal year for amounts greater
than $5,000 or greater than eight months old.
Local Economy
The City of Lansing is the seat of Michigan state government and the local economy is comprised of a
diversified mix of business and industries. With Michigan State University, Davenport University, Cooley Law
School and Lansing Community College, the region has a strong higher education presence. The metro
Lansing region is also home to several insurance company headquarters, including Jackson National Life, Auto
Owners, AF Group, and Delta Dental; healthcare services with two major hospitals in the city, Sparrow and
McLaren; and a wide variety of technology firms. Manufacturing also has a strong presence, especially in the
automotive and biotech engineering sectors, with two General Motors assembly plants and related facilities
located in the city, automotive suppliers throughout the region, Niowave's production of particle
accelerators, and Emergent Biosolution's research and vaccine production.
While its presence in the metro Lansing region has decreased over the past two decades, General Motors has
continued to invest in its two state-of-the-art Lansing plants, even during the recent Great Recession. The
plants produce the Buick Enclave, GMC Acadia, Chevrolet Traverse, Cadillac ATS (2013 North American Car of
the Year) and Cadillac CTS (2008 and 2014 Motor Trend Car of the Year). Production of the Chevrolet Camaro
was moved to Lansing from Ontario, Canada in July, 2015 and was subsequently named 2016 Motor Trend Car
of the Year. Over the past three years, General Motors has invested over $277 million in plant expansions
and retooling, $40 million in a new Logistics Center, and $174 million in a new regional stamping plant.
Currently under construction and scheduled for completion in 2022, Michigan State University will be home to
the $174 million Facility for Rare Isotope Beams (FRIB), which will enable scientific discovery of rare isotope
properties, will employ top nuclear physicists, and is expected to create approximately 1,000 jobs. Even
before the plant is completed, Niowave, Inc. established its operations in Lansing as commercial spinoff from
Michigan State University's nuclear cyclotron facility. MSU has been named #1 in Nuclear Physics, ahead of
MIT, by U.S. News Et World Report for four consecutive years.
Lansing serves as the cultural and commercial center for the region, and recent major investments have
revitalized downtown Lansing into an entertainment and residential destination, with renovations to historic
buildings and brand new developments. The former Lansing Board of Water Light downtown plant was
transformed in 2011 into the corporate headquarters for Accident Fund Insurance Company of America (now
AF Group), followed by Blue Cross Blue Shield of Michigan moving into Accident Fund's former downtown
location. Recent renovations of the former downtown Knapp's department store into apartments and
commercial space have attracted Dewpoint, CGI Group, Inc., and TEKsystems technology firms. Highly
successful, recently-completed new developments, including Marketplace, Midtown, and The Outfield, and
Skyview residential developments have added significant additional residential units near and within
downtown. The Outfield Ballpark Lofts development was the first in the nation to feature apartments
located right in the outfield of a Class-A minor league baseball stadium and has received national and
international awards.
5
In its commitment to regional partnerships, the City of Lansing has contracted with the Lansing Economic
Area Partnership (LEAP) since 2012. This arrangement allows for a cost-effective, regional-based approach
to economic development. As testament to its success, this past year, LEAP received the prestigious
Excellence in Economic Development Award by the International Economic Development Council (IEDC). Over
the past decade, LEAP and the Lansing Economic Development Corporation have attracted more than $2.3
billion in new private investment to the city.
The metro Lansing region is one of growth and opportunities. It was one of only two regions in the State of
Michigan to show population growth in the 2010 Census and has continued to see population growth. Over
$650 million in direct private economic development projects were announced in FY 2017 by Neogen
Corporation, Tecomet (formerly Symmetry Medical), XG Sciences, and McLaren Greater Lansing. The Lansing.
East Lansing MSA experienced 4.0% GDP growth in 2016, double the national average and was ranked fourth
(4th) in the Midwest for best places for college graduates to live and work.
Awards and Acknowledgements
The Government Finance Officers Association (GFOA) awarded a Certificate of Achievement for Excellence in
Financial Reporting to the City for its Comprehensive Annual Financial Report for the fiscal year ended June
30, 2016. This was the 39th consecutive year that the City has received this prestigious award. In order to be
awarded a Certificate of Achievement, the City must publish an easily readable and efficiently organized
comprehensive annual financial report. This report satisfied both generally accepted accounting principles
and applicable legal requirements.
The Certificate of Achievement is valid for a period of one year only. We believe that our current
Comprehensive Annual Financial Report continues to meet the Certificate of Achievement Program's
requirements and we are submitting it to the GFOA to determine its eligibility for another certificate.
Preparation of this comprehensive annual financial report was made possible by the dedicated service of the
entire staff of the Finance Department, as well as support by other departments. All those who contributed
to this document, especially Accounting Manager Randy Endsley, have our sincere appreciation for their
contributions made in the preparation of this report and in the financial management of the City. The 39th
consecutive GFOA award, recognizing their efforts, is well deserved indeed.
Sincerely,
Virg Bernero
Mayor
4 ���
Angela Bennett
Finance Director
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CITY OF LANSING, MICHIGAN
GFOA Certificate of Achievement
Government Finance Officers Association
Certificate of
Achievement
for Excellence
In Financial
Reporting
Presented to
City Of Laming
Michigan
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
June 30, 2016
Executive UirectorlCED
8
FINANCIAL SECTION
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10
RidRebmann Robson
Rehmann
2330 East Paris Ave.SE
Grand Rapids,MI 49546
Ph: 616.975.4100
Fx: 616.975.4400
rehmann.com
INDEPENDENT AUDITORS' REPORT
December 22, 2017
Honorable Mayor and
Members of the City Council
City of Lansing, Michigan
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, the business-
type activities, the aggregate discretely presented component units, each major fund, and the
aggregate remaining fund information of the City of Lansing, Michigan (the "City"), as of and for the
year ended June 30, 2017, and the related notes to the financial statements, which collectively
comprise the City's basic financial statements as listed in the table of contents.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this includes
the design, implementation, and maintenance of internal control relevant to the preparation and fair
presentation of financial statements that are free from material misstatement, whether due to fraud or
error.
Independent Auditors'Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted
our audit in accordance with auditing standards generally accepted in the United States of America and
the standards applicable to financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free from material
misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial statements. The procedures selected depend on the auditors' judgment, including the
assessment of the risks of material misstatement of the financial statements, whether due to fraud or
error. In making those risk assessments, the auditor considers internal control relevant to the entity's
preparation and fair presentation of the financial statements in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness of
significant accounting estimates made by management, as well as evaluating the overall presentation of
the financial statements.
11
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinions.
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities, the business-type activities, the aggregate
discretely presented component units, each major fund, and the aggregate remaining fund information
of the City of Lansing, Michigan, as of June 30, 2017, and the respective changes in financial position
and, where applicable, cash flows thereof and the budgetary comparison for the General Fund for the
year then ended in conformity with accounting principles generally accepted in the United States of
America.
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the
management's discussion and analysis and the schedules for the pension and other postemployment
benefits plans, as listed in the table of contents, be presented to supplement the basic financial
statements. Such information, although not a part of the basic financial statements, is required by the
Governmental Accounting Standards Board who considers it to be an essential part of financial reporting
for placing the basic financial statements in an appropriate operational, economic, or historical context.
We have applied certain limited procedures to the required supplementary information in accordance
with auditing standards generally accepted in the United States of America, which consisted of inquiries
of management about the methods of preparing the information and comparing the information for
consistency with management's responses to our inquiries, the basic financial statements, and other
knowledge we obtained during our audit of the basic financial statements. We do not express an opinion
or provide any assurance on the information because the limited procedures do not provide us with
sufficient evidence to express an opinion or provide any assurance.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that
collectively comprise the City's basic financial statements. The combining and individual fund financial
statements and schedules, and the introductory section and statistical tables are presented for purposes
of additional analysis and are not a required part of the basic financial statements.
The combining and individual fund financial statements and schedules are the responsibility of
management and were derived from and relate directly to the underlying accounting and other records
used to prepare the basic financial statements. Such information has been subjected to the auditing
procedures applied in the audit of the basic financial statements and certain additional procedures,
including comparing and reconciling such information directly to the underlying accounting and other
records used to prepare the basic financial statements or to the basic financial statements themselves,
and other additional procedures in accordance with auditing standards generally accepted in the United
States of America. In our opinion, the combining and individual fund financial statements and schedules
are fairly stated, in all material respects, in relation to the basic financial statements as a whole.
12
The introductory section and statistical tables have not been subjected to the auditing procedures
applied in the audit of the basic financial statements, and accordingly, we do not express an opinion or
provide any assurance on them.
Other Reporting Required by Government Auditing&andards
In accordance with Government Auditing Standards, we have also issued, under separate cover, our
report dated December 22, 2017, on our consideration of the City of Lansing, Michigan's internal control
over financial reporting and our tests of its compliance with certain provisions of laws, regulations,
contracts, and grant agreements and other matters. The purpose of that report is to describe the scope
of our testing of internal control over financial reporting and compliance and the results of that testing,
and not to provide an opinion on the internal control over financial reporting or on compliance. That
report is an integral part of an audit performed in accordance with Government Auditing Standards in
considering the City's internal control over financial reporting and compliance.
.n�.- L LC
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14
MANAGEMENT'S DISCUSSION AND ANALYSIS
15
CITY OF LANSING, MICHIGAN
Management's Discussion and Analysis
The management of the City of Lansing, Michigan ("the City") provides this narrative overview and analysis of the
financial activities of the City for the fiscal year ended June 30, 2017 for the benefit of the readers of these financial
statements. This management's discussion and analysis ("MD&A") is intended to assist the reader in focusing on
significant financial issues and provide an overview of the City's financial activity. The City encourages the readers
to consider the following information here in conjunction with the financial statements taken as a whole, which
follow this section.
Financial Highlights
Total government-wide assets and deferred outflows of resources of the City exceeded its liabilities and deferred
inflows of resources at the close of the fiscal year by $135.1 million (reported as net position), a decrease of$4.4
million from fiscal year 2015/2016.
As of the close of the 2016/2017 fiscal year, the City's governmental funds reported combined ending fund
balances of $33.1 million, a $2.2 million increase from fiscal year 2015/2016. Of the $33.1 million fiscal year
2016/2017 combined ending fund balance, $7.4 million is legally restricted and/or unavailable to spend (i.e.
amounts tied up in inventories), and $10.8 million is committed for designated projects, leaving $14.9 million
unassigned.
At the end of the fiscal year, unassigned fund balance for the General Fund, (including the amount internally
identified as a Budget Stabilization Fund), was $15.3 million, an increase of $2.9 million from FY 2015/2016.
Please see the "General Fund and Budgetary Highlights" section of this Management Discussion and Analysis for
further detail.
Business-type activities reported net position at year-end of $251.4 million, an increase of $8.8 million during the
year. The increase was mainly attributable to the increase in sewer fund net position for the fiscal year, which is
necessary to fund future debt needs associated with U.S. Environmental Projection Agency and Michigan
Department of Environmental Quality-mandated sewer separation projects.
The City's total long-term debt was $216.3 million at June 30, 2017, a decrease of $17.7 million, which primarily
represents the net difference between new issuances and payments. More detailed information regarding these
activities and funds can be found in Footnote 9, Long-Term Debt of the Notes to the Financial Statements section
of the Comprehensive Annual Financial Report ("CAFR").
Overview of the Financial Statements
This MDEtA is an introduction to the City's basic financial statements, which comprise three components: 1)
government-wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This
report also contains other required supplementary information in addition to the basic financial statements.
Government-Wide Financial Statements. The government-wide financial statements are designed to provide readers
with a broad overview of the City's finances, in a manner similar to a private-sector business. The Statement of Net
Position and the Statement of Activities are two financial statements that report information about the City, as a
whole, and about its activities, which provide measurements of long-term trends that should help answer this
question: Is the City, as a whole, better off or worse off as a result of this year's activities? Unlike the governmental
funds, the current year's revenues and expenses are taken into account regardless of when cash is received or paid,
known as "full accrual accounting".
16
CITY OF LANSING, MICHIGAN
Management's Discussion and Analysis
The Statement of Net Position presents all of the City's assets, deferred outflows of resources, liabilities and deferred
inflows of resources with the difference between the these categories reported as "net position". Over time,
increases and decreases in net position are an indicator of whether the City's long-term financial position is improving
or deteriorating, but can also change as a result of governmental accounting standards.
The Statement of Activities presents information showing how the City's net position changed during the most recent
fiscal year. All changes in net position are reported as soon as the underlying events giving rise to the change occur,
regardless of the timing of related cash flows. Therefore, revenues and expenses are reported in these statements for
some items that will only result in cash flows in future fiscal periods (e.g. uncollected taxes and earned but unused
vacation leave).
The Statement of Net Position and the Statement of Activities report three activities, as follows:
Governmental Activities. Most of the City's basic services are reported under this category. Property taxes,
income taxes, and intergovernmental revenues generally fund these services. The Council (legislative branch),
the District Court (judicial branch), and general operations of the executive branch departments, such as police,
fire, parks, public works, and other general staff departments fall within the governmental activities.
Business-type Activities. The City charges fees to customers to help cover all or most of the costs of certain
services it provides. Sewage collection and treatment and commercial area parking are examples of business-type
activities.
Discretely Presented Component Units. Component units are legally separate organizations for which the elected
officials of the primary government are financially accountable. The City has various discretely presented units:
the Brownfield Redevelopment Authority, the Tax Increment Finance Authority, and the Lansing Entertainment
and Public Facilities Authority.
These financial statements include two schedules that reconcile the amounts reported on the governmental fund
financial statements (modified accrual accounting) with governmental activities (full accrual accounting) on the
appropriate government-wide statements. The following summarizes the impact of transitioning from modified
accrual to full accrual accounting:
Capital assets used in governmental activities are not reported on governmental fund statements.
Certain revenues that are earned, but not available for use within the reporting period, are reported as revenues
for governmental activities, but are reported as deferred inflows of resources on the governmental fund
statements.
Other long-term assets that are not available to pay for current period expenditures are deferred in
governmental fund statements, but not deferred on the government-wide statements.
Internal service funds are reported as governmental activities, but reported as proprietary funds in the fund
financial statements.
Bond discounts and premiums in the issuance of long-term debt are reported as expenditures in governmental
fund statements, but are capitalized and amortized in the government-wide statements.
Unless due and payable, long-term liabilities, such as capital lease obligations, compensated absences, and others
only appear as liabilities in the government-wide statements.
17
CITY OF LANSING, MICHIGAN
Management's Discussion and Analysis
Capital outlay spending in excess of capitalization thresholds are recorded as capital assets on the government-
wide statements, but are reported as expenditures on the governmental fund statements.
Bond and note proceeds result in liabilities on the government-wide statements, but are recorded as other
financing sources on the governmental fund statements.
Certain other outflows, such as debt service principal payments, represent decreases in liabilities on the
government-wide statements, but are reported as expenditures on the governmental fund statements.
Pension and other postemployment benefits liabilities and related deferrals relating to governmental funds are
only reported in the government-wide statements.
The Notes to the Financial Statements provide additional information that is essential to a full understanding of the
data provided in the government-wide and fund financial statements.
Fund Financial Statements. The City's major funds are identified as the General Fund, Sewage Disposal System
Fund, and Municipal Parking System Fund. Data for all other funds, termed "nonmajor funds", are combined into a
single, aggregated presentation. A fund is a fiscal and accounting entity with a self-balancing set of accounts that the
City uses to keep track of specific sources of funding and spending for a particular purpose.
Governmental funds. Most of the City's basic services are reported in the governmental funds, which focus on
how money flows into and out of those funds and the balances left at year-end that are available for future
spending. The governmental fund financial statements provide a detailed short-term view of the City's general
government operations and the basic services it provides. Governmental fund information helps determine
whether there are greater or fewer financial resources that can be spent in the near future to finance the City's
programs. These funds are reported using modified accrual accounting, which measures cash and all other
financial assets that can readily be converted to cash. Governmental funds include the General Fund and special
revenue, capital projects, debt service, and permanent funds.
Proprietary funds. When the City charges customers for the services it provides, whether to outside customers or
to other agencies within the City, these services are generally reported in proprietary funds. Proprietary funds
(enterprise and internal service) utilize full accrual accounting; the same method used by private sector
businesses. Enterprise funds report activities that provide supplies and services to the general public. Examples
are the Sewage Disposal Fund and the Municipal Parking Fund. Internal service funds are reported as
governmental activities on the government-wide statements.
Fiduciary Funds. The City acts as a trustee or fiduciary, for its employee pension and other postemployment
benefit plans. It is also responsible for other assets that, because of a trust arrangement, can be used only for
the trust beneficiaries. The City's fiduciary activities are reported in separate Statements of Fiduciary Net
Position and Changes in Fiduciary Net Position. These funds, which include pension and other postemployment
benefit funds, are reported using full accrual accounting. The government-wide statements exclude fiduciary
fund activities and balances because these assets are restricted in purpose and do not represent spendable assets
of the City to finance its operations.
Required Supplementary Information
Following the basic financial statements is additional Required Supplementary Information that further explains and
supports the information in the financial statements. The Required Supplementary Information includes required
pension and other postemployment benefit supplementary information.
18
CITY OF LANSING, MICHIGAN
Management's Discussion and Analysis
Other Supplementary Information
Other supplementary information includes combining financial statements for nonmajor governmental, proprietary,
and fiduciary funds. These funds are added together, by fund type, and presented in single columns in the basic
financial statements, but are not reported individually, as with major funds, on the governmental fund financial
statements.
Government-Wide Financial Analysis
The City's combined net position decreased $4.4 million over the course of this fiscal year's operations, and came to
a total of $135.1 million. Net position of governmental activities decreased $13.2 million or 12.8%, and business-type
activities increased $8.8 million or 3.6%. Explanations for those changes are described below under the governmental
activities and business-type activities sections of this Management Discussion and Analysis.
Net Position
Governmental Activities Business-type Activities Total
2017 2016 2017 2016 2017 2016
Current and other assets $ 55,942,975 $ 59,967,923 $ 81,676,247 $ 75,273,478 $137,619,222 $135,241,401
Capital assets, net 188,807,551 194,187,285 362,595,277 371,535,963 551,402,828 565,723,248
Total assets 244,750,526 254,155,208 444,271,524 446,809,441 689,022,050 700,964,649
Deferred outflows of
resources 48,237,654 59,465,643 4,877,793 7,190,842 53,115,447 66,656,485
Long-term debt outstanding 51,709,198 56,959,949 164,568,715 176,980,629 216,277,913 233,940,578
Other liabilities 332,505,634 355,363,179 30,502,474 33,360,540 363,008,108 388,723,719
Total liabilities 384,214,832 412,323,128 195,071,189 210,341,169 579,286,021 622,664,297
Deferred inflows of
resources 25,036,395 4,376,709 2,682,266 1,055,949 27,718,661 5,432,658
Net position
Net investment in
capital assets 149,533,948 149,676,860 224,161,744 220,436,882 373,695,692 370,113,742
Restricted 10,993,950 12,922,525 1,818,671 2,764,963 12,812,621 15,687,488
Unrestricted (276,790,945) (265,678,371) 25,415,447 19,401,320 (251,375,498) (246,277,051)
Total net position $(116,263,047) $(103,078,986) $251,395,862 $242,603,165 $135,132,815 $139,524,179
The largest component of the City's net position reflects its net investment in capital assets (e.g. land, buildings,
equipment, infrastructure, and others). Restricted net position is the next largest component, which represents
amounts subject to external restrictions such as bond covenants, City Charter, State legislation or Constitutional
provision. The remaining portion, unrestricted net position are resources that may be used at the City's discretion,
but often have limitations based on policy action.
19
CITY OF LANSING, MICHIGAN
Management's Discussion and Analysis
The following condensed financial information was derived from the government-wide Statement of Activities and
reflects how the City's net position changed during the fiscal year:
Change in Net Position
Governmental Activities Business-type Activities Total
2017 2016 2017 2016 2017 2016
Program revenues
Charges for services $ 13,293,904 $ 13,941,487 $ 47,889,559 $ 45,583,654 $ 61,183,463 $ 59,525,141
Operating grants 25,157,629 24,561,960 1,391,326 1,312,362 26,548,955 25,874,322
Capital grants 63,488 904,298 100,000 - 163,488 904,298
General revenues
Taxes 76,262,288 73,151,678 - 76,262,288 73,151,678
State shared revenues 14,412,644 13,911,200 14,412,644 13,911,200
Unrestricted grants
and contributions 23,695,900 22,621,075 23,695,900 22,621,075
Unrestricted investment
earnings 125,539 99,058 125,539 99,058
Gain on sale of
capital assets 135,270 63,079 - 3,853 135,270 66,932
Total revenues 153,146,662 149,253,835 49,380,885 46,899,869 202,527,547 196,153,704
Expenses
General government 21,778,154 27,993,414 - - 21,778,154 27,993,414
Public safety 91,829,441 85,739,408 91,829,441 85,739,408
Public works 28,983,891 28,212,049 28,983,891 28,212,049
Recreation and culture 9,441,519 10,336,168 9,441,519 10,336,168
Community development 12,349,663 10,642,102 12,349,663 10,642,102
Interest on long-term debt 1,201,846 1,424,215 1,201,846 1,424,215
Sewage disposal system - - 27,567,228 28,487,957 27,567,228 28,487,957
Municipal parking system 6,866,747 7,651,077 6,866,747 7,651,077
Cemetery 886,579 708,545 886,579 708,545
Golf 802,564 845,575 802,564 845,575
Garbage and rubbish
collection 1,543,380 2,085,728 1,543,380 2,085,728
Recycling 3,667,899 4,092,278 3,667,899 4,092,278
Total expenses 165,584,514 164,347,356 41,334,397 43,871,160 206,918,911 208,218,516
Change in net position,
before transfers (12,437,852) (15,093,521) 8,046,488 3,028,709 (4,391,364) (12,064,812)
Transfers (746,209) (629,715) 746,209 629,715
Change in net position (13,184,061) (15,723,236) 8,792,697 3,658,424 (4,391,364) (12,064,812)
Net position:
Beginning of year (103,078,986) (87,355,750) 242,603,165 238,944,741 139,524,179 151,588,991
End of year $(116,263,047) $(103,078,986) $251,395,862 $242,603,165 $135,132,815 $139,524,179
20
CITY OF LANSING, MICHIGAN
Management's Discussion and Analysis
Governmental Activities. The following chart depicts revenues of the governmental activities for the fiscal year:
Revenues - Governmental Activities
Fiscal Year Ending June 30, 2017
Property tax and special
assessments
26.5% Income tax
23.3%
Otherrevenues
0 2% Charges for services
8.7%
Unrestricted grants and
contributions Operating grants
15.5% 16.4%
Capital grants
0.0%
State shared revenues
9.4%
In total, governmental activity revenues increased $3,982,827 from FY 2015/2016 to FY 2016/2017, with trends of the
major revenue categories as follows:
Property taxes and special assessments comprised the largest portion of governmental activity revenue at 26.5%, or
$40.6 million, a $2.0 million, or 5.2%increase from fiscal year 2015/2016. This increase was caused by rising property
values and allocation from the state eligible manufacturing personal property tax assessment.
Income taxes comprised 23.3%, or $35.7 million, of governmental activity revenue, the full amount of which is
revenue to the General Fund. This represents a $1.1 million, or 3.2%, increase from fiscal year 2015/2016. Local
income tax rates are prescribed by State law, and limited in Lansing's case to 1% of resident income and 0.5% of the
income of persons working in the City, but living outside of its corporate boundaries.
Restricted operating and capital grants and contributions made up $25.2 million, or 16.5% of governmental activity
revenue for fiscal year 2016/2017, a $0.2 million, or 1.0%decrease from fiscal year 2015/2016.
Unrestricted grants and contributions (including state shared sales tax revenue) comprised 24.9%, or $38.1 million, of
revenues, a $1.6 million, or 4.3% increase from fiscal year 2015/2016. A little more than one-third of this category,
$14.4 million, is attributed to State revenue sharing, an amount distributed to municipalities by the State of Michigan
by formula allocation of portions of the State sales tax.
Charges for services are program-specific revenues generated for services provided. Governmental activity charges
for services decreased $0.6 million from FY 2015/2016 to FY 2016/2017.
21
CITY OF LANSING, MICHIGAN
Management's Discussion and Analysis
The following chart depicts expenses of the governmental activities for the fiscal year:
Expenses - Governmental Activities
Fiscal Year Ending June 30, 2017
Community Interest on long-term
development debt
7.5% 0.7% General government
Recreation and culture 13.2%
5.7%
Public works
17.5%
Public safety
55.4%
Total expenses for governmental activities increased $1.2 million, 0.8%, from FY 2015/2016 to FY 2016/2017, with
trends of the major revenue categories as follows:
The largest component of governmental activities was public safety, accounting for 55.5%, or $91.8 million, a $7.1%
($6.1 million) increase from FY 2015/2016. The increase was largely attributable to a large number of vacancies
being filled, as well as fringe benefit costs, most notably pension and retiree healthcare costs.
Public works comprises the next largest component of governmental activity expenses, at 17.5%, or $29.0 million, a
2.7% ($771,842) increase from FY 2015/2016.
At $21.8 million, general government expenses, representing general and internal City services, comprised 13.2% of
governmental activities. This category experienced a $6.2 million, or 22.2% decrease from FY 2015/2016, due to a
combination of a one-time recategorization of Planning and Neighborhood Development from general government to
community service and a lesser pension expense allocation than FY 2015/2016.
Community development represented 7.5% expenses. This category increased $1.7 million, or 16.0% from FY
2015/2016, due to the above-mentioned, one-time recategorization of Planning and Neighborhood Development from
general government to community service.
Business-type Activities. Net position of the business-type activities increased by $8.8 million, or 3.6%, from FY
2015/2016 to $251.4 million. The increase was mainly attributable to the increase in sewer fund net position for the
fiscal year, which is necessary to fund future debt needs associated with U.S. Environmental Projection Agency and
Michigan Department of Environmental Quality-mandated sewer separation projects.
Financial Analysis of the City's Funds
As the City completed the fiscal year, its governmental funds reported combined ending fund balances of $33.1
million, a $2.2 million increase from fiscal year 2015/2016. Of the $33.1 million fiscal year 2016/2017 combined
ending fund balance, $7.4 million is legally restricted and/or unavailable to spend (i.e. amounts tied up in
inventories), and $10.8 million is committed for designated projects, leaving $14.9 million unassigned.
22
CITY OF LANSING, MICHIGAN
Management's Discussion and Analysis
The unassigned fund balance for the General Fund, (including the amount internally identified as a Budget
Stabilization Fund), was $15.3 million, an increase of $2.9 million from FY 2015/2016, which is further described in
the next section, General Fund Budgetary Highlights.
General Fund Budgetary Highlights
The FY 2016/2017 General Fund budget was adopted as a balanced budget, based on projected revenues, with a
$500,000 addition to reserves (fund balance). The City budgeted a vacancy factor in its General Fund to account for
anticipated positions that would become vacant during the course of the year. Because vacancies that will occur
within each department cannot be projected, the vacancy factor is budgeted as a single line item of the General
Fund and allocated to various departments through a budget amendment during the year. During the course of the
fiscal year, the General Fund budget was amended from $124 million to $126.1 million to recognize higher-than-
expected income tax revenues, to allocate the vacancy factor, and to adjust expenditures in response to higher-than
expected election costs, police overtime, fleet needs, and information technology upgrades.
General Fund reserves, combined with the Budget Stabilization Fund (combined for financial statement purposes)
increased $2.4 million from FY 2015/2016 from $13.3 million to $15.7 million. Unassigned fund balance increased $2.9
million (slightly more than the total fund balance increase due to changes in fund balance restrictions), or 23.2%from
fiscal year 2015/2016. The $2.4 million increase in total General Fund reserves was attributable to revenues
exceeding budgeted amounts by $1.0 million (largely resulting from higher-than-budgeted income tax revenues) as
well as expenditures coming in under budget by$1.6 million, largely due to position vacancies during the fiscal year.
Sewage Disposal Fund
Net position increased $7.3 million to $239.7 million in FY 2016/2017. Unrestricted net position increased $5.4
million, from $21.6 million to $27.0 million. The increase in total net position was the result of sewer operations for
the year and is necessary to fund future debt needs associated with the U.S. Environmental Projection Agency and
Michigan Department of Environmental Quality-mandated sewer separation projects.
Municipal Parking Fund
The Municipal Parking Fund net position increased $1.1 million to $16.5 million. Unrestricted net position remained
relatively consistent at $5.5 million.
Capital Assets. At the end of the fiscal year 2017, the City had invested $551.4 million, net of accumulated
depreciation, in a broad range of capital assets (see the table below). Additional information regarding the City's
capital assets can be found in Footnote 6 of the of the Notes to the Financial Statements section of the CAFR.
Capital Assets (Net of Depreciation)
Governmental Activities Business-type Activities Total
2017 2016 2017 2016 2017 2016
Land $ 25,880,189 $ 25,838,193 $ 13,292,491 $ 13,483,910 $ 39,172,680 $ 39,322,103
Land improvements 10,968,327 10,285,057 11,006,206 11,561,180 21,974,533 21,846,237
Buildings and improvements 54,462,360 58,888,516 88,022,794 92,246,302 142,485,154 151,134,818
Equipment 7,291,993 6,776,694 1,203,507 1,384,910 8,495,500 8,161,604
Infrastructure 90,204,682 91,733,706 240,205,647 240,872,516 330,410,329 332,606,222
Construction in progress - 665,119 8,864,632 11,987,145 8,864,632 12,652,264
Total capital assets, net $ 188,807,551 $ 194,187,285 $362,595,277 $371,535,963 $551,402,828 $565,723,248
23
CITY OF LANSING, MICHIGAN
Management's Discussion and Analysis
Debt Administration. The City, along with the Lansing Building Authority (LBA), a blended component unit of the
City, is empowered by law to authorize, issue, and sell debt obligations. Limited tax and unlimited tax general
obligation bonds are backed by the full faith and credit of the City. The City also issues revenue-dedicated bonded
debt, whose payment for principal and interest comes solely out of funds that receive legally-restricted revenues.
The Sewage Disposal fund has the City's only dedicated revenue bonds currently outstanding. LBA's bonds financed
the construction of parking structures, golf courses, and other related improvements. Revenues derived from user
fees from persons using parking and golf facilities fund the debt service requirements for related improvements, but
they are also backed by a limited tax pledge.
Outstanding Debt
2017 2016
Governmental activities
General obligation bonds $ 18,065,000 $ 21,900,000
Installment purchase contracts 13,757,531 15,268,317
Loans 7,728,428 7,872,600
Compensated absences 9,725,419 9,552,788
Workers compensation 2,417,780 2,297,914
Deferred amounts:
For issuance discounts (66,154) (72,988)
For issuance premiums 81,194 141,318
Total governmental activities 51,709,198 56,959,949
Business-type activities
General obligation bonds 144,016,807 154,534,187
Revenue bonds 17,175,000 18,725,000
Installment purchase
agreements 1,029,723 1,246,673
Compensated absences 794,830 759,258
Deferred amounts:
For issuance discounts (563,347) (636,356)
For issuance premiums 2,115,702 2,351,867
Total business-type activities 164,568,715 176,980,629
Total outstanding debt $216,277,913 $233,940,578
More detailed information regarding these activities and funds can be found in Footnote 9 of the of the Notes to the
Financial Statements section of the CAFR.
24
CITY OF LANSING, MICHIGAN
Management's Discussion and Analysis
Economic Condition and Outlook
Unemployment levels in the City continued to decline in FY 2016/2017, resulting in increased income tax revenue.
Property values increased; however growth in corresponding property tax revenue is limited by State of Michigan
Statute to the rate of inflation for property that does not change hands. Lansing's financial picture as a whole has
stabilized and continues to improve. The 2016/2017 fiscal year resulted in a $2.9 million addition to General Fund
unassigned reserves and a surplus is again expected in FY 2017/2018, bringing unassigned General Fund reserves up to
$15.8 million, or 12.3% of General Fund expenditures, reaching the City's 12%-15% fund balance policy. However,
significant challenges remain in the longer-term. Going forward, State-imposed limitations on municipal revenues,
most notably those on property tax growth, will continue to constrain resources, which in context of projected
increases in pension, healthcare, and infrastructure needs, will present significant budgetary challenges.
Strengthening the City's economic base, building back up General Fund reserves, and addressing long-term pension
and retiree healthcare obligations are top priorities. The City continues to work diligently with its employees and
unions to address the ongoing structural imbalance between projected revenues and long-term pension and retiree
health care costs and has been successful in achieving significant agreements over the past several years on a wide
range of cost-saving measures. The City, in conjunction with the Mayor-appointed Financial Health Team engaged a
consultant for studies of its long-term pension and retiree healthcare obligations. Recommendations by the
consultant and the Financial Health Team are expected by the end of calendar year 2017.
The City continues to experience significant economic development and national recognition of its economic
development efforts and accomplishments. For more information, please see the "Local Economy" section of the
Transmittal Letter.
Requests for Information
This financial report is designed to provide our citizens, taxpayers, customers, investors, and creditors with a general
overview of the City's finances and to demonstrate the City's accountability for the money it receives. Copies of this
financial report, as well as other financial reports, are available on the City's website, www.lansingmi.gov. If you
have any questions about this report or need additional financial information, please feel free to contact the Finance
Department at (517) 483-4500.
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26
BASIC FINANCIAL STATEMENTS
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28
GOVERNMENT-WIDE FINANCIAL STATEMENTS
29
CITY OF LANSING, MICHIGAN
Statement of Net Position
June 30, 2017
Primary Government
Governmental Business-type Component
Activities Activities Totals Units
Assets
Cash and investments $ 29,473,076 $ 37,457,782 $ 66,930,858 $ 4,640,656
Receivables, net 26,707,412 38,309,355 65,016,767 1,424,568
Internal balances (1,857,477) 1,857,477 - -
Due from component unit 1,109,931 1,109,931 -
Due from primary government - - - 1,408,365
Inventories, prepaids and other assets 1,619,964 378,501 1,998,465 200,006
Restricted assets:
Cash and investments - 2,563,201 2,563,201 1,108,366
Capital assets not being depreciated 25,880,189 22,157,123 48,037,312 -
Capital assets being depreciated, net 162,927,362 340,438,154 503,365,516 2,768
Total assets 244,750,526 4447271,524 689,022,050 8,784,729
Deferred outflows of resources
Deferred charge on refunding 116,407 2,446,570 2,562,977 3,778,351
Deferred pension amounts 48,121,247 2,431,223 50,552,470 -
Total deferred outflows of resources 48,237,654 4,877,793 53,115,447 3,778,351
Liabilities
Accounts payable and
accrued liabilities 12,075,404 1,691,015 13,766,419 1,251,006
Accrued interest payable 289,643 875,974 1,165,617 15,789,447
Unearned revenue 1,143,416 128,872 1,272,288 284,175
Due to component units - 1,408,365 1,408,365 -
Due to primary government - - - 1,109,931
Long-term debt:
Due within one year 5,948,095 14,059,049 20,007,144 673,684
Due in more than one year 45,7617103 150,509,666 196,270,769 297996,721
Net pension liability 252,315,241 26,398,248 278,713,489 -
Net other postemployment benefit obligation 66,681,930 - 66,6817930
Total liabilities 384,214,832 1957071,189 579,286,021 497104,964
Deferred inflows of resources
Deferred pension amounts 25,036,395 2,682,266 27,718,661 -
Net position
Net investment in capital assets 149,5337948 224,1617744 373,695,692 2,768
Restricted for:
Public safety 1,459,792 - 1,459,792 -
Public works 3,946,003 3,946,003
Community development 3,582,057 3,582,057
Building department 197,707 - 197,707 -
Debt service - 1,667,185 1,667,185 537,565
Capital projects - 151,486 151,486 -
Endowments(nonexpendable) 1,8087391 - 17808,391
Unrestricted (deficit) (2767790,945) 25,415,447 (251,3757498) (37,082,217)
Total net position $(116,263,047) $ 251,395,862 $ 135,132,815 $ (36,541,884)
The accompanying notes are an integral part of the financial statements.
30
CITY OF LANSING, MICHIGAN
Statement of Activities
For the Year Ended June 30, 2017
Program Revenues
Operating Capital Net
Charges Grants and Grants and (Expense)
Functions/Programs Expenses for Services Contributions Contributions Revenues
Primary government
Governmental activities:
General government $ 21,778,154 $ 7,295,556 $ 1,905,606 $ $ (12,576,992)
Public safety 91,829,441 3,476,966 4,252,037 (84,100,438)
Public works 28,983,891 1,836,466 13,330,591 63,488 (13,753,346)
Recreation and culture 9,441,519 617,604 127,859 - (8,696,056)
Community development 12,349,663 67,312 5,541,536 (6,740,815)
Interest on long-term debt 1,201,846 - - - (1,201,846)
Total governmental activities 165,584,514 13,293,904 25,157,629 63,488 (127,069,493)
Business-type activities:
Sewage disposal system 27,567,228 34,755,896 297,805 100,000 7,586,473
Municipal parking system 6,866,747 6,906,091 1,080,979 - 1,120,323
Cemetery 886,579 403,663 2,177 (480,739)
Golf 802,564 256,218 4,233 (542,113)
Garbage and rubbish collection 1,543,380 1,952,897 - 409,517
Recycling 3,667,899 3,614,794 6,132 - (46,973)
Total business-type activities 41,334,397 47,889,559 1,391,326 100,000 8,046,488
Total primary government $ 206,918,911 $ 61,183,463 $ 26,548,955 $ 163,488 $ (119,023,005)
Component units
Brownfield redevelopment
authority $ 769,979 $ - $ 196,498 $ - $ (573,481)
Tax increment finance
authority 3,891,930 - - (3,891,930)
Lansing entertainment Et
public facilities authority 8,611,237 7,052,871 1,257,300 (301,066)
Total component units $ 13,273,146 $ 7,052,871 $ 1,453,798 $ $ (4,766,477)
continued...
31
CITY OF LANSING, MICHIGAN
Statement of Activities
For the Year Ended June 30, 2017
Primary Government
Governmental Business-type Component
Activities Activities Totals Units
Changes in net position
Net (expense) revenues $(127,069,493) $ 8,046,488 $(119,023,005) $ (4,766,477)
General revenues:
Property taxes 40,568,278 - 40,568,278 4,669,039
Income taxes 35,694,010 35,694,010 -
Grants and contributions not
restricted to specific programs 38,108,544 38,108,544 -
Unrestricted investment earnings 125,539 125,539 13,840
Gain on sale of capital assets 135,270 135,270 -
Transfers - internal activities (746,209) 746,209 - -
Total general revenues and transfers 113,885,432 746,209 114,631,641 4,682,879
Change in net position (13,184,061) 8,792,697 (4,391,364) (83,598)
Net position, beginning of year (103,078,986) 242,603,165 139,524,179 (36,458,286)
Net position, end of year $ (116,263,047) $ 251,395,862 $ 135,132,815 $ (36,541,884)
concluded
The accompanying notes are an integral part of the financial statements.
32
FUND FINANCIAL STATEMENTS
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34
CITY OF LANSING, MICHIGAN
Governmental Fund Financial Statements
Major Fund
General Fund - This is the general operating fund of the City. It is used to account for and report
all financial resources not accounted for and reported in another fund.
Nonmajor Funds
Nonmajor governmental funds are presented, by fund type, within the Combining and Individual
Fund Financial Statements and Schedules section of this report as noted in the table of contents.
35
CITY OF LANSING, MICHIGAN
Balance Sheet
Governmental Funds
June 30, 2017
Nonmajor
Governmental
General Funds Totals
Assets
Cash and cash equivalents $ 2,685,128 $ 95,380 $ 2,780,508
Equity in pooled cash and investments 7,978,332 12,903,493 20,881,825
Accounts receivable, net 8,114,762 135,937 8,250,699
Taxes receivable 49,729 - 49,729
Special assessments receivable - 288,878 288,878
Loans receivable 1,426,440 1,426,440
Accrued interest receivable - 2,355,617 2,355,617
Due from other governments 4,954,572 9,310,474 14,265,046
Inventories 20,513 805,025 825,538
Prepaids 7,829 5,468 13,297
Total assets $ 23,810,865 $ 27,326,712 $ 51,137,577
Liabilities
Accounts payable $ 3,629,204 $ 2,034,997 $ 5,664,201
Deposits payable - 102,376 102,376
Accrued payroll 1,439,279 66,379 1,505,658
Indemnity bonds - 36,425 36,425
Due to other funds 1,600,000 1,600,000
Advances from other funds - 257,477 257,477
Due to other governments 1,120,882 984,404 2,105,286
Unearned revenue 88,077 1,055,339 1,143,416
Other 835,191 - 835,191
Total liabilities 7,112,633 6,137,397 13,250,030
Deferred inflows of resources
Unavailable revenues-fees 1,000,966 - 1,000,966
Unavailable revenues- loans and accrued interest receivable - 3,582,057 3,582,057
Unavailable revenues- special assessments - 242,499 242,499
Total deferred inflows of resources 1,000,966 3,824,556 4,825,522
Fund balances
Nonspendable 28,342 2,618,884 2,647,226
Restricted - 4,730,012 4,730,012
Committed 385,067 10,426,961 10,812,028
Unassigned (deficit) 15,283,857 (411,098) 14,872,759
Total fund balances 15,697,266 17,364,759 33,062,025
Total liabilities, deferred inflows of
resources and fund balances $ 23,810,865 $ 27,326,712 $ 51,137,577
The accompanying notes are an integral part of the financial statements.
36
CITY OF LANSING, MICHIGAN
Reconciliation
Fund Balances of Governmental Funds
to Net Position of Governmental Activities
June 30, 2017
Fund balances-total governmental funds $ 33,062,025
Amounts reported for governmental activities in the statement of net position are different because:
Capital assets used in governmental activities are not financial resources and therefore are not reported in
the funds.
Capital assets not being depreciated 25,880,189
Capital assets being depreciated, net 162,927,362
Capital assets accounted for in internal service funds, net (12,503,129)
Because the focus of governmental funds is on short-term financing, some assets will not be available to pay
for current expenditures. Those assets (i.e., receivables)are offset by deferred inflows of resources in the
governmental funds and, therefore, are not included in fund balance.
Deferred ambulance fees receivable 445,577
Deferred nuisance fees receivable 532,889
Deferred loans receivable 1,226,440
Deferred long-term interest receivable 2,355,617
Deferred long-term special assessments receivable 242,499
Deferred long-term taxes and tax settlement receivables 22,500
Internal service funds are used by management to charge the costs of certain equipment maintenance to
individual funds. The assets and liabilities of the internal service funds are included in governmental
activities in the statement of net position. 12,614,758
Long-term liabilities and related deferred outflows are not due and payable in the current period and
therefore are not reported in the funds.
Bonds, loans and leases payable, and deferred discounts/premiums (35,702,984)
Deferred charge on refunding 116,407
Accrued interest on bonds, loans and leases payable (263,390)
Net other postemployment benefit obligation (66,681,930)
Compensated absences and other long-term liabilities (11,307,488)
Certain pension-related amounts, such as the net pension liability and deferred amounts, are not due and
payable in the current period or do not represent current financial resources and therefore are not reported
in the funds.
Net pension liability (252,315,241)
Deferred outflows related to the net pension liability 48,121,247
Deferred inflows related to the net pension liability (25,036,395)
Net position of governmental activities $ (116,263,047)
The accompanying notes are an integral part of the financial statements.
37
CITY OF LANSING, MICHIGAN
Statement of Revenues, Expenditures and Changes in Fund Balances
Governmental Funds
For the Year Ended June 30, 2017
Nonmajor
Governmental
General Funds Totals
Revenues
Taxes and special assessments $ 39,597,810 $ 1,093,515 $ 40,691,325
Income taxes 35,694,010 - 35,694,010
Licenses and permits 1,494,298 - 1,494,298
Intergovernmental 16,211,983 20,179,778 36,391,761
Charges for services 9,113,089 4,117,733 13,230,822
Fines and forfeits 2,240,100 270,845 2,510,945
Interest and rents 161,228 40,139 201,367
Contributions 21,973,270 10,000 21,983,270
Otherrevenues 158,592 810,725 969,317
Total revenues 126,644,380 26,522,735 153,167,115
Expenditures
Current expenditures:
General government 20,690,998 3,257,370 23,948,368
Public safety 72,140,597 1,542,649 73,683,246
Public works 11,200,151 1,364 11,201,515
Highways and streets - 10,969,516 10,969,516
Recreation and culture 7,749,245 - 7,749,245
Community development - 4,142,612 4,142,612
Other functions 2,710,979 - 2,710,979
Debt service:
Principal 1,661,987 2,934,172 4,596,159
Interest 537,720 582,798 1,120,518
Capital outlay - 9,328,278 9,328,278
Total expenditures 116,691,677 32,758,759 149,450,436
Revenues over(under)expenditures 9,952,703 (6,236,024) 3,716,679
Other financing sources (uses)
Transfersin 520,338 9,367,289 9,887,627
Transfers out (8,201,433) (3,296,503) (11,497,936)
Proceeds on sale of capital assets 97,255 - 97,255
Total other financing sources(uses) (7,583,840) 6,070,786 (1,513,054)
Net change in fund balances 2,368,863 (165,238) 2,203,625
Fund balances, beginning of year 13,328,403 17,529,997 30,858,400
Fund balances, end of year $ 15,697,266 $ 17,364,759 $ 33,062,025
The accompanying notes are an integral part of the financial statements.
38
CITY OF LANSING, MICHIGAN
Reconciliation
Net Changes in Fund Balances of Governmental Funds
to Change in Net Position of Governmental Activities
For the Year Ended June 30, 2017
Net changes in fund balances-total governmental funds $ 2,203,625
Amounts reported for governmental activities in the statement of activities are different because:
Governmental funds report capital outlay as expenditures. However, in the statement of activities, the cost
of those assets is allocated over their estimated useful lives as depreciation expense.
Capital assets purchased/constructed 4,365,710
Depreciation expense (9,938,437)
Gain on sale of capital assets 80,905
Proceeds on sale of capital assets (97,255)
Revenues in the statement of activities that do not provide current financial resources are not reported as
revenues in the funds, but rather are deferred to subsequent fiscal years.
Changein deferred ambulance fees receivable (159,631)
Changein deferred nuisance fees receivable 79,572
Changein deferred loans receivable (1,938)
Changein deferred long-term interest receivable 69,250
Changein deferred special assessments receivable (102,822)
Changein deferred taxes and tax settlement receivables (40,154)
Internal service funds are used by management to charge the costs of certain equipment maintenance to
individual funds. The net increase (decrease)in the net position of the internal service funds is reported
with governmental activities.
Net operating loss from governmental activities in internal service funds (672,507)
Gain on sale of capital assets from governmental internal service funds 54,365
Interest expense from governmental internal service funds (141,962)
Transfers in from governmental internal service funds 1,650,000
Transfers out of governmental internal service funds (785,900)
Debt proceeds provide current financial resources to governmental funds in the period issued, but issuing
debt increases long-term liabilities in the statement of net position. Repayment of debt principal is an
expenditure in the funds, but the repayment reduces long-term liabilities in the statement of net position.
Principal payments on long-term liabilities 4,596,159
Certain expenditures are reported in governmental funds that reduce long-term liabilities for purposes of the
statement of net position.
Change in estimated liability for workers'compensation (119,866)
Some expenses reported in the statement of activates do not require the use of current financial resources
and therefore are not reported as expenditures in the funds.
Change in accrued interest payable on long-term liabilities 38,830
Amortization of issuance premiums and discounts, and deferred charge on refunding 21,804
Change in net other postemployment benefit obligation (4,667,046)
Change in net pension liability and related deferral amounts (9,491,689)
Change in the accrual for compensated absences (125,074)
Change in net position of governmental activities $ (13,184,061)
The accompanying notes are an integral part of the financial statements.
39
CITY OF LANSING, MICHIGAN
Statement of Revenues, Expenditures and Change in Fund Balance
Budget and Actual - General Fund
For the Year Ended June 30, 2017
Actual Over
Original Final (Under) Final
Budget Budget Actual Budget
Revenues
Property taxes $ 38,952,000 $ 38,952,000 $ 39,597,810 $ 645,810
Income taxes 33,150,000 34,670,000 35,694,010 1,024,010
Licenses and permits 1,652,500 1,630,500 1,494,298 (136,202)
Intergovernmental 15,655,900 15,655,900 16,211,983 556,083
Charges for services 9,153,500 9,820,440 9,113,089 (707,351)
Fines and forfeits 2,960,100 2,960,100 2,240,100 (720,000)
Interest and rents 38,500 38,500 161,228 122,728
Contributions 22,000,000 21,762,500 21,973,270 210,770
Otherrevenues 320,500 128,000 158,592 30,592
Total revenues 123,883,000 125,617,940 126,644,380 1,026,440
Expenditures
General government:
Attorney's office 1,880,700 1,740,700 1,713,062 (27,638)
City clerk 1,018,700 1,018,700 1,046,228 27,528
Council 675,800 675,800 639,021 (36,779)
Courts 6,247,400 6,197,400 6,090,057 (107,343)
Internal audit 202,200 172,200 153,220 (18,980)
Finance 5,063,800 4,963,800 4,745,147 (218,653)
Library rental 165,000 165,000 130,615 (34,385)
LEPFA support 331,400 1,257,300 1,257,300
Human resources 2,139,000 2,139,000 2,134,094 (4,906)
Mayor 1,050,200 1,050,200 1,047,284 (2,916)
Office of community media 415,600 415,600 380,823 (34,777)
Office of financial empowerment 182,100 202,100 199,880 (2,220)
Planning / neighborhood development 1,091,500 1,261,500 1,154,267 (107,233)
Budgetary savings from attrition (800,000) - -
Total general government 19,663,400 21,259,300 20,690,998 (568,302)
Public safety:
Police 38,952,900 39,252,900 38,837,419 (415,481)
Fire 33,612,300 33,590,410 33,303,178 (287,232)
Total public safety 72,565,200 72,843,310 72,140,597 (702,713)
Public works 10,867,100 11,032,712 11,200,151 167,439
Recreation and culture 7,893,900 7,893,900 7,749,245 (144,655)
continued...
40
CITY OF LANSING, MICHIGAN
Statement of Revenues, Expenditures and Change in Fund Balance
Budget and Actual - General Fund
For the Year Ended June 30, 2017
Actual Over
Original Final (Under) Final
Budget Budget Actual Budget
Expenditures (concluded)
Other functions:
Human relations / community services $ 1,249,200 $ 1,119,200 $ 998,795 $ (120,405)
Human services / community support 1,537,500 1,876,861 1,712,184 (164,677)
Total other functions 2,786,700 2,996,061 2,710,979 (285,082)
Debt service:
Principal 850,000 1,662,000 1,661,987 (13)
Interest 195,200 539,300 537,720 (1,580)
Total debt service 1,045,200 2,201,300 2,199,707 (1,593)
Total expenditures 114,821,500 118,226,583 116,691,677 (1,534,906)
Revenues over expenditures 9,061,500 7,391,357 9,952,703 2,561,346
Other financing sources (uses)
Transfersin 117,000 417,000 520,338 103,338
Transfers out (8,678,500) (8,307,871) (8,201,433) (106,438)
Proceeds on sale of capital assets 130,000 97,255 (32,745)
Total other financing sources (uses) (8,561,500) (7,760,871) (7,583,840) 177,031
Net change in fund balance 500,000 (369,514) 2,368,863 2,738,377
Fund balance, beginning of year 13,328,403 13,328,403 13,328,403 -
Fund balance, end of year $ 13,828,403 $ 12,958,889 $ 15,697,266 $ 2,738,377
concluded
The accompanying notes are an integral part of the financial statements.
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42
CITY OF LANSING, MICHIGAN
Proprietary Fund Financial Statements
Major Funds
Sewage Disposal System Fund This fund accounts for the provision of sewage disposal services to the
residents of the City.
Municipal Parking System Fund This fund accounts for the operation of City-owned parking facilities.
Nonmajor Funds and Internal Service Funds
Nonmajor enterprise funds and internal service funds are presented, by fund type, within the Combining
and Individual Fund Financial Statements and Schedules section of this report as noted in the table of
contents.
43
CITY OF LANSING, MICHIGAN
Statement of Net Position
Proprietary Funds
June 30,2017
Governmental
Business-type Activities-Enterprise Funds Activities
Sewage Municipal Nonmajor
Disposal Parking Enterprise Internal
System System Funds Totals Service Funds
Assets
Current assets:
Cash and cash equivalents $ 5,447,246 $ 562,852 $ 48,008 $ 6,058,106 $ 57,842
Equity in pooled cash and investments 20,507,369 9,132,734 1,759,573 31,399,676 5,752,901
Accounts receivable,net 14,946,000 260,861 73,432 15,280,293 71,003
Accrued interest receivable 42,978 92,302 - 135,280 -
Lease receivable,current 642,788 - - 642,788 -
Inventories 322,177 - 51,324 373,501 481,514
Prepaids - 5,000 - 5,000 299,615
Due from other funds 1,600,000 362,870 1,962,870 -
Due from component units 1,109,931 - 1,109,931 -
Total current assets 44,618,489 10,416,619 1,932,337 56,967,445 6,662,875
Noncurrent assets:
Restricted cash and cash equivalents 2,411,715 151,486 - 2,563,201 -
Advances to other funds - 257,477 257,477
Lease receivable,net of current portion 7,512,563 14,738,431 - 22,250,994 -
Capital assets not being depreciated 9,285,381 12,367,501 504,241 22,157,123 92,892
Capital assets being depreciated,net 321,912,911 15,692,518 2,832,725 340,438,154 12,410,237
Total noncurrent assets 341,122,570 43,207,413 3,336,966 387,666,949 12,503,129
Total assets 385,741,059 53,624,032 5,269,303 444,634,394 19,166,004
Deferred outflows of resources
Deferred charge on refunding 1,088,903 1,357,667 - 2,446,570 -
Deferred pension amounts 1,178,950 426,007 826,266 2,431,223
Total deferred outflows of resources 2,267,853 1,783,674 826,266 4,877,793
Liabilities
Current liabilities:
Accounts payable 1,265,588 101,050 106,200 1,472,838 778,132
Deposits payable - 66,715 - 66,715 -
Accrued interest payable 744,530 126,398 5,046 875,974 26,253
Accrued payroll 89,832 42,648 18,982 151,462 163,135
Claims incurred but not reported - - - - 885,000
Due to other funds 359,928 2,942 362,870 -
Due to component units 1,408,365 - - 1,408,365
Unearned revenues - - 128,872 128,872 -
Bonds and notes payable,current portion 11,825,000 1,970,000 221,223 14,016,223 832,965
Compensated absences,current portion 19,654 - 23,172 42,826 65,835
Total current liabilities 15,712,897 2,309,753 503,495 18,526,145 2,751,320
Noncurrent liabilities:
Bonds and notes payable,net of current portion 117,559,098 31,390,064 808,500 149,757,662 3,030,050
Compensated absences,net of current portion 435,274 139,322 177,408 752,004 769,876
Net pension liability 13,219,121 4,641,540 8,537,587 26,398,248 -
Total noncurrent liabilities 131,213,493 36,170,926 9,523,495 176,907,914 3,799,926
Total liabilities 146,926,390 38,480,679 10,026,990 195,434,059 6,551,246
Deferred inflows of resources
Deferred pension amounts 1,391,491 473,460 817,315 2,682,266 -
Net position
Net investment in capital assets 211,058,448 10,796,053 2,307,243 224,161,744 8,640,114
Restricted for debt retirement 1,667,185 - - 1,667,185 -
Restricted for capital projects - 151,486 151,486 -
Unrestricted(deficit) 26,965,398 5,506,028 (7,055,979) 25,415,447 3,974,644
Total net position $ 239,691,031 $ 16,453,567 $ (4,748,736) $ 251,395,862 $ 12,614,758
The accompanying notes are an integral part of the financial statements.
44
CITY OF LANSING, MICHIGAN
Statement of Revenues, Expenses and Changes in Fund Net Position
Proprietary Funds
For the Year Ended June 30,2017
Governmental
Business-type Activities-Enterprise Funds Activities
Sewage Municipal Nonmajor
Disposal Parking Enterprise Internal
System System Funds Totals Service Funds
Operating revenues
Charges for services $ 34,755,896 $ 6,906,091 $ 6,227,572 $ 47,889,559 $ 78,004,573
Operating expenses
Personal services 6,373,370 2,049,770 3,352,611 11,775,751 8,093,046
Purchase of goods and services 7,470,279 1,693,054 2,915,446 12,078,779 68,650,239
Depreciation 10,316,607 1,739,900 384,001 12,440,508 1,933,795
Total operating expenses 24,160,256 5,482,724 6,652,058 36,295,038 78,677,080
Operating income(loss) 10,595,640 1,423,367 (424,486) 11,594,521 (672,507)
Nonoperating revenues(expenses)
Interest revenue 297,805 43,045 10,527 351,377 -
Gain(loss)on sale of capital assets - (142,076) 2,015 (140,061) 54,365
Interest expense and fees (3,406,972) (1,241,947) (33,878) (4,682,797) (141,962)
Capital contribution to others - (214,486) (214,486)
Otherrevenues 1,037,934 - 1,037,934
Total nonoperating revenue(expenses) (3,109,167) (303,044) (235,822) (3,648,033) (87,597)
Income(loss)before contributions and transfers 7,486,473 1,120,323 (660,308) 7,946,488 (760,104)
Contributions and transfers
Capital contributions 100,000 - - 100,000 -
Transfers in - 1,085,749 1,085,749 1,650,000
Transfers out (300,000) (39,540) (339,540) (785,900)
Total contributions and transfers (200,000) 1,046,209 846,209 864,100
Change in net position 7,286,473 1,120,323 385,901 8,792,697 103,996
Net position,beginning of year 232,404,558 15,333,244 (5,134,637) 242,603,165 12,510,762
Net position,end of year $ 239,691,031 $ 16,453,567 $ (4,748,736) $ 251,395,862 $ 12,614,758
The accompanying notes are an integral part of the financial statements.
45
CITY OF LANSING, MICHIGAN
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30,2017
Governmental
Business-type Activities-Enterprise Funds Activities
Sewage Municipal Nonmajor
Disposal Parking Enterprise Internal
System System Funds Totals Service Funds
Cash flows from operating activities
Cash received from customers $ 26,365,411 $ 6,660,624 $ 6,261,403 $ 39,287,438 $ -
Cash received from interfund services - - - - 78,513,825
Cash payments for goods and services (8,857,149) (1,625,927) (2,954,533) (13,437,609) (68,691,581)
Cash payments to employees (6,857,228) (2,206,191) (3,726,868) (12,790,287) (7,788,630)
Net cash provided by(used in)operating activities 10,651,034 2,828,506 (419,998) 13,059,542 2,033,614
Cash flows from noncapital financing activities
Transfers in - - 1,085,749 1,085,749 1,650,000
Transfers out (300,000) (39,540) (339,540) (785,900)
Cash advanced to other funds (16,168) - (16,168) -
Net cash provided by(used in)
noncapital financing activities (300,000) (16,168) 1,046,209 730,041 864,100
Cash flows from capital and related financing activities
Proceeds from sale of capital assets 49,343 2,015 51,358 102,751
Acquisition and construction of capital assets (3,491,202) (125,527) (74,512) (3,691,241) (2,191,524)
Capital contributions received 100,000 100,000
Capital contributions to others - (214,486) (214,486)
Proceeds from issuance of long-term debt 1,767,693 - 1,767,693
Principal paid on long-term debt (11,810,073) (1,920,000) (321,950) (14,052,023) (893,799)
Interest paid on long-term debt (3,538,367) (1,159,270) (32,854) (4,730,491) (147,541)
Payments received on capital lease 631,084 631,084
Net cash used in capital and related
financing activities (16,340,865) (3,155,454) (641,787) (20,138,106) (3,130,113)
Cash flows from investing activities
Interest and dividends received 301,064 44,322 10,527 355,913
Payments received on loans made to others - 63,848 - 63,848
Net cash provided by investing activities 301,064 108,170 10,527 419,761
Net change in cash and cash equivalents (5,688,767) (234,946) (5,049) (5,928,762) (232,399)
Cash and cash equivalents,beginning of year 34,055,097 10,082,018 1,812,630 45,949,745 6,043,142
Cash and cash equivalents,end of year $ 28,366,330 $ 9,847,072 $ 1,807,581 $ 40,020,983 $ 5,810,743
Reconciliation to statement of net position
Cash and cash equivalents $ 5,447,246 $ 562,852 $ 48,008 $ 6,058,106 $ 57,842
Equity in pooled cash and investments 20,507,369 9,132,734 1,759,573 31,399,676 5,752,901
Restricted cash and cash equivalents 2,411,715 151,486 - 2,563,201 -
$ 28,366,330 $ 9,847,072 $ 1,807,581 $ 40,020,983 $ 5,810,743
continued...
46
CITY OF LANSING, MICHIGAN
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30,2017
Governmental
Business-type Activities-Enterprise Funds Activities
Sewage Municipal Nonmajor
Disposal Parking Enterprise Internal
System System Funds Totals Service Funds
Reconciliation of operating income(loss)to net cash
provided by(used in)operating activities
Operating income(loss) $ 10,595,640 $ 1,423,367 $ (424,486) $ 11,594,521 $ (672,507)
Adjustments to reconcile operating income(loss)to
net cash provided by(used in)operating activities:
Depreciation 10,316,607 1,739,900 384,001 12,440,508 1,933,795
Change in:
Accounts receivable (26,897) 93,273 11,245 77,621 509,252
Inventories (11,094) - 12,140 1,046 (106,623)
Prepaids (4,400) - (4,400) 62,997
Due from other funds (8,363,588) (347,080) (8,710,668) -
Due from component units (1,109,931) - (1,109,931) -
Accounts payable 557,000 68,585 (48,930) 576,655 2,284
Deposits payable - 8,340 8,340 -
Accrued payroll 20,191 9,172 (5,441) 23,922 27,923
Claims incurred but not reported - - - 228,936
Due to other funds (2,231,210) 2,942 (2,297) (2,230,565) -
Due to component units 1,408,365 - - 1,408,365
Unearned revenues - - 22,586 22,586 -
Compensated absences 62,781 24,358 (51,567) 35,572 47,557
Net pension liability and related deferred amounts (566,830) (189,951) (317,249) (1,074,030) -
Net cash provided by(used in)operating activities $ 10,651,034 $ 2,828,506 $ (419,998) $ 13,059,542 $ 2,033,614
concluded
The accompanying notes are an integral part of the financial statements.
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CITY OF LANSING, MICHIGAN
Fiduciary Fund Financial Statements
Pension and Other Postemployment Benefit Trust Funds - Employee pension and other postemployment
benefit trust funds accept payments made by the City, invest fund resources, calculate and pay pensions
to retirees (or beneficiaries), and account for postemployment healthcare coverage.
Combining schedules for fiduciary funds are presented in the notes to the financial statements.
Agency Funds - These funds account for resources held in a trustee or agent capacity for the 54-A District
Court.
Combining statements for agency funds are presented, by fund type, within the Combining and Individual
Fund Financial Statements and Schedules section of this report as noted in the table of contents.
49
CITY OF LANSING, MICHIGAN
Statement of Fiduciary Net Position
Fiduciary Funds
June 30, 2017
Pension
and Other
Postemployment
Benefits Trust Agency
Funds Funds
Assets
Cash and cash equivalents $ 17,339,063 $
Equity in pooled cash and investments 2,387,484 69,891
Investments:
Money market funds 10,365,214
Government obligations 48,998,208 -
Corporate bonds 5201,676
Common stocks 129,315,722
Emerging markets 730,520
Mutualfunds 297,248,253
Contribution receivable 10,150
Dividends and interest receivable 393,025
Total assets 559,469,315 $ 69,891
Liabilities
Accounts payable 9,913,641 $ -
Undistributed receipts - 69,891
Due to other funds - -
Total liabilities 9,913,641 $ 69,891
Net position restricted for
Pension benefits 460,741,710
Other postemployment benefits 88,813,964
Total net position $ 549,555,674
The accompanying notes are an integral part of the financial statements.
50
CITY OF LANSING, MICHIGAN
Statement of Changes in Fiduciary Net Position
Pension and Other Postemployment Benefits Trust Funds
For the Year Ended June 30, 2017
Additions
Investment income:
Net appreciation in fair value
of investments $ 53,887,426
Interest income 2,139,931
Dividend income 4,213,808
Investment expenses (1,784,828)
Net investment income 58,456,337
Contributions:
Employer 45,453,707
Plan members 4,130,131
Total contributions 49,583,838
Total additions 108,040,175
Deductions
Participant benefits 75,283,690
Administrative expense 1,012,685
Total deductions 76,296,375
Change in net position 31,743,800
Net position restricted for pension and other postemployment benefits
Beginning of year 517,811,874
End of year $ 549,555,674
The accompanying notes are an integral part of the financial statements.
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52
COMPONENT UNITS
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54
CITY OF LANSING, MICHIGAN
Discretely Presented Component Units
Discretely presented component units are entities that are legally separate from the City but for
which the City is financially accountable, or their relationship with the City is such that exclusion
would cause the City's financial statements to be misleading or incomplete. The City has three
discretely presented component units:
Brownfield Redevelopment Authority
Tax Increment Finance Authority
Lansing Entertainment and Public Facilities Authority
Complete financial statements for each of the individual component units may be obtained from
the entity's administrative offices.
55
CITY OF LANSING, MICHIGAN
Combining Statement of Net Position
Discretely Presented Component Units
June 30, 2017
Lansing
Tax Entertainment
Brownfield Increment Et Public
Redevelopment Finance Facilities
Authority Authority Authority Totals
Assets
Cash and cash equivalents $ 1,017,945 $ 3,413,323 $ 209,388 $ 4,640,656
Receivables, net 2421643 - 1,181,925 1,424,568
Due from primary government 1,408,365 - 1,408,365
Inventories, prepaids and other assets - - 200,006 200,006
Restricted cash and cash equivalents 537,565 570,801 1,108,366
Capital assets being depreciated, net - - 2,768 2,768
Total assets 2,668,953 3,950,888 2,164,888 8,784,729
Deferred outflows of resources
Deferred charge on refunding - 3,778,351 - 3,778,351
Liabilities
Accounts payable and
accrued liabilities 579,608 11,900 659,498 1,251,006
Accrued interest payable - 15,789,447 - 15,789,447
Unearned revenues - 284,175 284,175
Due to primary government 1,109,931 - 1,109,931
Long-term debt:
Due within one year 673,684 673,684
Due in more than one year - 29,996,721 - 29,996,721
Total liabilities 579,608 47,581,683 943,673 49,104,964
Net position
Investment in capital assets - - 2,768 2,768
Restricted for debt service - 537,565 - 537,565
Unrestricted (deficit) 2,089,345 (40,390,009) 1,218,447 (37,082,217)
Total net position $ 2,089,345 $ (39,852,444) $ 1,221,215 $ (36,541,884)
The accompanying notes are an integral part of the financial statements.
56
CITY OF LANSING, MICHIGAN
Combining Statement of Activities
Discretely Presented Component Units
For the Year Ended June 30, 2017
Lansing
Tax Entertainment
Brownfield Increment Et Public
Redevelopment Finance Facilities
Authority Authority Authority Totals
Expenses
Brownfield redevelopment $ 769,979 $ $ $ 769,979
Community development - 3,891,930 - 3,891,930
Recreation and culture - - 8,611,237 8,611,237
Total expenses 769,979 3,891,930 8,611,237 13,273,146
Program revenues
Charges for services - - 7,052,871 7,052,871
Operating grants and contributions 196,498 1,257,300 1,453,798
Total program revenues 196,498 8,310,171 8,506,669
Net program expense (573,481) (3,891,930) (301,066) (4,766,477)
General revenues
Property taxes 1,639,427 2,635,591 394,021 4,669,039
Unrestricted investment earnings 2,390 11,449 1 13,840
Total general revenues 1,641,817 2,647,040 394,022 4,682,879
Changes in net position 1,068,336 (1,244,890) 92,956 (83,598)
Net position, beginning of year 1,021,009 (38,607,554) 1,128,259 (36,458,286)
Net position, end of year $ 2,089,345 $ (39,852,444) $ 1,221,215 $ (36,541,884)
The accompanying notes are an integral part of the financial statements.
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58
NOTES TO FINANCIAL STATEMENTS
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60
CITY OF LANSING, MICHIGAN
Index - Notes to Financial Statements
Page
1. Summary of Significant Accounting Policies 62
Reporting Entity
Government-wide and Fund Financial Statements
Measurement Focus, Basis of Accounting, and Financial Statement Presentation
Assets, Deferred Outflows of Resources, Liabilities, Deferred Inflows of Resources, and Equity
2. Budgetary Information 72
3. Deficit Fund Equity 73
4. Deposits and Investments 74
5. Receivables 80
6. Capital Assets 82
7. Accounts Payable and Accrued Liabilities 84
8. Interfund Receivables, Payables and Transfers 84
9. Long-Term Debt 86
10.Fund Balances - Governmental Funds 89
11.Net Investment in Capital Assets 90
12.Segment Information - Enterprise Funds 90
13.Risk Management 91
14.Property Taxes 92
15.Contingent Liabilities 92
16.Pension Plans 92
17.Other Postemployment Benefits 106
18.Operating Leases 116
19.Tax Abatements 117
61
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The City of Lansing (the "City") was incorporated in 1859. In 1909, the City came under the provisions of
Act 279, P.A. 1909, as amended ("Home Rule City Act"). The City operates under a strong Mayor form of
government in which the Mayor is responsible for implementation and administration of City policy as
established by City Council.
The accounting and reporting policies of the City conform in all material respects to generally accepted
accounting principles (GAAP) as applicable to governments. The Governmental Accounting Standards Board
(GASB) is the standard setting body for establishing governmental accounting and financial reporting
principles, which are primarily set forth in the GASB's Codification of Governmental Accounting and
Financial Reporting Standards (GASB Codification). Following is a summary of the significant policies:
Reporting Entity
As required by generally accepted accounting principles, these financial statements present the City and its
component units, entities for which the City is considered to be financially accountable. The financial data
of the component units are included in the City's reporting entity because of the significance of their
operational or financial relationships with the City.
Blended Component Unit
A blended component unit is a legally separate entity from the City but is so intertwined with the City that
it is, in substance, the same as the City. It is reported as part of the City and its financial data is combined
with data of the appropriate funds. The City has one blended component unit, the Building Authority with a
fiscal June 30 year-end. This component unit provides services primarily to benefit the City. The blended
unit is described as follows:
The Building Authority (the "Authority") was established by the City under Act 31, Michigan Public Acts of
1948. The Mayor, with the advice and consent of City Council, appoints the Authority's governing body and
designates management. The Authority uses the proceeds of its tax-exempt bonds to finance the
construction or acquisition of capital assets for the City only. The bonds are secured by lease agreements
with the City and will be retired through lease payments from the City. The financial activity, assets,
liabilities and equity of the Authority are incorporated within the City's Municipal Parking System and Golf
enterprise funds, and the 2015 Refunding Debt Service Fund.
Discretely Presented Component Units
Discretely presented component units are entities that are legally separate from the City but for which the
City is financially accountable, or their relationship with the City is such that exclusion would cause the
City's financial statements to be misleading or incomplete. The discretely presented component units are
as follows:
62
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
The Lansing Brownfield Redevelopment Authority ("LBRA") was established by the City on August 17, 1997,
under the authority contained in Act 381, Michigan Public Acts of 1996 (the "Act"). The Act authorizes the
City to establish and to designate the boundaries of a Brownfield redevelopment zone. The Brownfield
Redevelopment Authority is appointed by City Council to preside over such a zone, and it is authorized to
promote the revitalization of environmentally distressed areas within the City of Lansing. The Act allows
the LBRA to participate in a broad range of improvement activities intended to encourage the reuse of
industrial and commercial property by offering economic incentives for redevelopment to prevent property
value deterioration. Tax increment financing plans must be approved by the City.
Tax increment financing permits the LBRA to capture tax revenues which are attributable to increases in
the value of real and personal property located within an approved project area. Current activities of the
LBRA include collections of property tax revenues on project areas for the Rite Aid Pharmacy and the
former Motor Wheel Site Plant.
The Tax Increment Finance Authority ("TIFA") was established by the City under the authority contained
in Act 450, Michigan Public Acts of 1981 ("Act 450"). Act 450 authorizes the City to designate specific
districts within its corporate limits as TIFA districts. The TIFA presides over such districts, formulating plans
for public improvements, economic development, neighborhood revitalization, and historic preservation
within the districts. Act 450 allows the TIFA to participate in a broad range of improvement activities
intended to contribute to economic growth and prevent property value deterioration. The TIFA's governing
body is appointed by the Mayor with the advice and consent of the City Council. Bond issuances, to fund the
above activities, are approved by the City Council and the legal liability for the debt remains with the City.
The Lansing Entertainment and Public Facilities Authority ("LEPFA") was established under the charter of
the City of Lansing, Michigan in February 1996, replacing the former Greater Lansing Convention/Exhibition
Authority, which had been responsible for operating and managing the Lansing Center and the Lansing Civic
Arena (the latter through the fiscal year ended June 30, 1995). LEPFA was established to oversee the
management and operations of the Lansing Center, the City Market and the Cooley Law School stadium.
LEPFA is chartered as a building authority under the provisions of Act 31, Public Acts of Michigan, 1948. In
the event of dissolution or termination of LEPFA, all assets and rights of the Authority shall revert to the
City. LEPFA's Board of Commissioners consists of thirteen members appointed by the Mayor of the City of
Lansing and approved by the City Council.
63
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Component Unit Financial Statements
Complete financial statements for the individual component units may be obtained from each entity's
administrative offices.
City of Lansing Building Authority
8th Floor
124 West Michigan Avenue
Lansing, Michigan 48933
Brownfield Redevelopment Authority / Tax Increment Finance Authority
1000 S Washington Avenue, Suite 201
Lansing, Michigan 48910
Lansing Entertainment and Public Facilities Authority
333 East Michigan Avenue
Lansing, Michigan 48933
Joint Venture
In 1998, the City entered into an agreement with Ingham County (the "County") to form the City of Lansing
and County of Ingham Joint Building Authority (JBA) for the purpose of constructing and managing a building
in downtown Lansing that houses the courts, prosecuting attorney and other related departments. The JBA
is governed by a three-member board composed of one member each appointed by the City and the County
and one appointed jointly by the two units. Both the County and the City contribute cash and/or property
to the JBA. Bonds were issued in 1999 by the JBA to provide the funding necessary to construct the
building. Because the joint venture agreement does not provide an explicit contractual formula outlining
the City's claim to the JBA's assets, it is considered to be a "joint venture with no equity interest" and
accordingly, no amounts are reported in the accompanying financial statements for an equity interest.
Financial information for the JBA may be obtained by writing the Ingham County Financial Services Division,
P.O. Box 319, Mason, Michigan 48854.
Government-wide and Fund Financial Statements
The government-wide financial statements (i.e., the statement of net position and the statement of
activities) report information on all of the nonfiduciary activities of the primary government and its
component units. Governmental activities, which normally are supported by taxes and intergovernmental
revenues, are reported separately from business-type activities, which rely to a significant extent on fees
and charges for support. Likewise, the primary government is reported separately from certain component
units for which the primary government is financially accountable.
The statement of activities demonstrates the degree to which the direct expenses of a given function or
segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a
specific function or segment. Program revenues include (1) charges to customers or applicants who
purchase, use, or directly benefit from goods, services, or privileges provided by a given function or
segment and (2) grants and contributions that are restricted to meeting the operational or capital
requirements of a particular function or segment. Taxes and other items not properly included among
program revenues are reported instead as general revenues.
64
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Separate financial statements are provided for governmental funds, proprietary funds and fiduciary funds,
even though the latter are excluded from the government-wide financial statements. Major individual
governmental funds and major individual enterprise funds are reported as separate columns in the fund
financial statements.
Measurement Focus, Basis of Accounting, and Financial Statement Presentation
The government-wide financial statements are reported using the economic resources measurement focus
and the accrual basis of accounting, as are the proprietary fund and fiduciary fund financial statements.
Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of
the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are
levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by
the provider have been met. Agency funds, a type of fiduciary fund, are unlike all other types of funds,
reporting only assets and liabilities. Therefore, agency funds cannot be said to have a measurement focus.
They do, however, use the accrual basis of accounting to recognize receivables and payables.
Governmental funds are reported using the current financial resources measurement focus and the modified
accrual basis of accounting. Under this method, revenues are recognized when measurable and available.
Revenues are considered to be available when they are collectible within the current period or soon enough
thereafter to pay liabilities of the current period. The City considers all revenues reported in the
governmental funds to be available if they are collected within three months after year-end, except for
income taxes that use a 45-day collection period, property taxes that use a 60-day collection period, and
reimbursement-based grants that use one year. Expenditures generally are recorded when a liability is
incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related
to compensated absences and claims and judgments, are recorded only when payment is due.
Property taxes, intergovernmental revenue, licenses, and interest associated with the current fiscal period
are all considered to be susceptible to accrual and as such have been recognized as revenues of the current
fiscal period. Only the portion of special assessments receivable due within the current fiscal period is
considered to be susceptible to accrual as revenue of the current period. All other revenue items are
considered to be measurable and available only when cash is received by the City.
The City reports the following major governmental fund:
General fund. This fund is the City's primary operating fund. It accounts for all the financial resources
of the primary government, except those accounted for and reported in another fund.
The City reports the following major enterprise funds:
Sewage Disposal System Fund. This fund accounts for the provision of sewage disposal services to the
residents of the City.
Municipal Parking System Fund. This fund accounts for the operation of City-owned parking facilities.
65
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Additionally, the City reports the following fund types:
Special Revenue Funds are used to account for and report the proceeds of specific revenue sources that
are restricted or committed to expenditure for specified purposes other than debt service or capital
projects that comprise, or are expected to comprise a substantial portion of the fund's total reported
inflows.
Debt Service Funds are used to account for and report financial resources that are restricted,
committed, or assigned to expenditure for principal, interest and related costs.
Capital Projects Funds are used to account for and report financial resources that are restricted,
committed, or assigned to expenditure for capital outlays, including the acquisition or construction of
capital facilities and other capital assets.
Permanent Funds account for resources that are legally restricted to the extent that only earnings, and
not principal, may be used for purposes that support the government's programs.
Enterprise Funds account for those operations that are financed and operated in a manner similar to
private business or where the City has decided that the determination of revenues earned, costs incurred
and/or net income is necessary for management accountability.
Internal Service Funds account for operations that provide services to other departments or agencies of
the City, or to other governments, on a cost-reimbursement basis. This includes operating a maintenance
facility for trucks and equipment used by the Public Service Department, health care and self-insurance
services, and information technology.
Pension and Other Postemployment Benefit Trust Funds account for the accumulation of resources to be
used for retirement annuity payments to eligible full-time employees of the City, certain healthcare
costs, and other retirement distributions.
The Agency Fund account for resources held in a fiduciary capacity for the 54-A District Court.
As a general rule the effect of interfund activity has been eliminated from the government-wide financial
statements. Exceptions to this general rule are payments in lieu of taxes and various other functions of the
government. Elimination of these charges would distort the direct costs and program revenues reported for
the various functions concerned.
Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating
revenues and expenses generally result from providing services and producing and delivering goods in
connection with a proprietary fund's principal ongoing operations. The principal operating revenues of the
City's enterprise and internal service funds are charges to customers for sales and services. Operating
expenses for enterprise funds and internal service funds include the cost of sales and services,
administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this
definition are reported as nonoperating revenues and expenses.
66
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Nonexchange transactions, in which the City gives (or receives) value without directly receiving (or giving)
equal value in exchange, include property taxes, grants, entitlements and donations. On an accrual basis,
revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenue from
grants, entitlements and donations is recognized in the fiscal year in which all eligibility requirements have
been satisfied.
Restricted net position are assets that are subject to restrictions beyond the government's control. The
restrictions may be externally imposed or imposed by law. When both restricted and unrestricted resources
are available for use, it is the government's policy to use restricted resources first, then unrestricted
resources as they are needed.
Assets, Deferred Outflows of Resources, Liabilities, Deferred Inflows of Resources, and Equity
Deposits and Investments
The City maintains an investment pool for all City funds. Each fund's portion of the investment pool is
displayed on the statement of net position/balance sheet as "equity in pooled cash." The City's cash and
cash equivalents are considered to be cash on hand, demand deposits and short-term investments with
original maturities of three months or less from the date of acquisition.
Restricted cash consists of amounts required to be maintained separately in accordance with bond
covenants.
State statutes authorize the City to invest in:
Bonds, securities, other obligations and repurchase agreements of the United States, or an agency or
instrumentality of the United States.
Certificates of deposit, savings accounts, deposit accounts or depository receipts of a qualified financial
institution.
Commercial paper rated at the time of purchase within the two highest classifications established by not
less than two standard rating services and that matures not more than 270 days after the date of
purchase.
Bankers' acceptances of United States banks.
Obligations of the State of Michigan and its political subdivisions, that, at the time of purchase are rated
as investment grade by at least one standard rating service.
Mutual funds registered under the Investment Company Act of 1940 with the authority to purchase only
investment vehicles that are legal for direct investment by a public corporation.
External investment pools as authorized by Public Act 20 as amended through December 31, 1997.
67
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Investments are stated at fair value. Short-term investments are reported at cost, which approximates fair
value. Securities traded on a national or international exchange are valued at the last reported sales price
at current exchange rates. Mortgages are valued on the basis of future principal and interest payments, and
are discounted at prevailing interest rates for similar instruments. Investments that do not have established
market values are reported at estimated fair value. Cash deposits are reported at carrying amounts, which
reasonably approximates fair value.
Unrealized appreciation or depreciation on pension and other postemployment benefit trust fund
investments due to changes in fair value are recognized each year.
Receivables
All receivables are reported at their gross value and, where appropriate, are reduced by the estimated
portion that is expected to be uncollectible.
Transactions between funds that are representative of lending/borrowing arrangements outstanding at the
end of the fiscal year are referred to as either due to/from other funds (i.e., the current portion of
interfund loans) or advances to/from other funds (i.e., the non-current portion of interfund loans). All other
outstanding balances between funds are reported as due to/from other funds. Any residual balances
outstanding between the governmental activities and business-type activities are reported in the
government-wide financial statements as internal balances.
Amounts due from other governments include amounts due from grantors for specific programs and capital
projects. Program grants and capital grants for capital assets are recorded as receivables and revenues at
the time reimbursable project costs are incurred. Amounts received in advance of project costs being
incurred are reported as unearned revenue.
Certain receivables in governmental funds consist of rehabilitation and redevelopment loans that are
generally not expected or scheduled to be collected in the subsequent year.
Leases receivable consist of amounts collectible from local municipalities for which the City has irrevocably
pledged its full faith and credit as collateral for certain construction and improvement bonds. In accordance
with contractual agreements, these entities will provide all future amounts due for bond principal and
accrued interest payable. The receivable has been reported as current based on the amounts to be
collected next year to satisfy obligations.
Inventories and Prepaids
All inventories are valued at cost using the first-in/first-out method. Inventories of governmental funds are
recorded as expenditures when consumed.
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as
prepaid items in both government-wide and fund financial statements. In governmental funds, prepaid
items are charged to expenditures using the consumption method.
68
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Capital Assets
Capital assets, which include property, plant, equipment, and infrastructure assets (e.g., roads, bridges,
sidewalks, and similar items acquired or constructed since June 30, 1980), are reported in the applicable
governmental or business-type activities columns in the government-wide financial statements. Capital
assets are defined by the City as assets having a useful life in excess of three years and whose costs exceed
$5,000 ($100,000 for buildings). Capital assets are stated at historical cost or estimated historical cost
where actual cost information is not available. Donated capital assets are recorded at their estimated
acquisition cost as of the donation date.
The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend
asset lives are not capitalized. Major outlays for capital assets and improvements are capitalized as projects
are constructed. Interest incurred during the construction phase of capital assets of business-type activities,
if any, is included as part of the capitalized value of the asset constructed.
Capital assets are depreciated using the straight-line method over the following estimated useful lives:
Years
Buildings 20-50
Improvements 8-50
Equipment 3-15
Sanitary sewers 50
Infrastructure 10-75
In addition to land and construction in progress, the amount presented as capital assets not being
depreciated includes intangible assets consisting of land development rights acquired for the purpose of
farmland and ranch preservation. Land development rights are deemed to have an indefinite useful life,
and therefore are not being amortized.
The City reviews long-lived assets for impairment whenever events or changes in circumstances indicate
that the carrying amount of an asset exceeds its fair value. If it is determined that an impairment loss has
occurred the asset is written down to its net realizable value and a current charge to income is recognized.
Deferred Outflows of Resources
In addition to assets, the statement of financial position will sometimes report a separate section for
deferred outflows of resources. This separate financial statement element, deferred outflows of resources,
represents a consumption of net position that applies to one or more future periods and so will not be
recognized as an outflow of resources (expense/expenditure) until then. The City reports deferred outflows
of resources for change in expected and actual investment returns, assumptions, and benefits provided in
its pension plans as well as for the deferred charge on refunding. A deferred refunding charge results from
the difference in the carrying value of refunded debt and its reacquisition price. This amount is deferred
and amortized over the shorter of the life of the refunded or refunding debt.
69
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Pa yabl es
Activity between funds that are representative of lending/borrowing arrangements outstanding at the end
of the fiscal year are referred to as either interfund receivables/payables (i.e., the current portion of
interfund loans) or advances to/from other funds (i.e., the non-current portion of interfund loans). All other
outstanding balances between funds are reported as due to/from other funds. Any residual balances
outstanding between the governmental and business-type activities are reported in the government-wide
financial statements as internal balances.
Compensated Absences
It is the City's policy to permit employees to accumulate earned but unused vacation and compensatory
time benefits, subject to certain limitations. Certain bargaining unit employees are also permitted to
accumulate earned but unused sick leave. All vacation and compensatory time pay and 50% of sick leave are
accrued when incurred in the government-wide and proprietary fund financial statements. A liability for
these amounts is reported in governmental funds only if they have matured, for example, as a result of
employee resignations or retirements.
Unearned Revenue
Unearned revenue consists of amounts received prior to the delivery of goods/service or expenditure on
allowable costs.
Long-term Obligations
In the government-wide financial statements, and proprietary fund types in the fund financial statements,
long-term debt and other long-term obligations are reported as liabilities in the applicable governmental
activities, business-type activities, or proprietary fund statement of net position. Bond premiums and
discounts are deferred and amortized over the life of the bonds using the straight-line basis. Bonds payable
are reported net of the applicable bond premium or discount. Bond issuance costs are reported as expenses
when incurred.
In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well
as bond issuance costs, during the current period. The face amount of debt issued is reported as other
financing sources. Premiums received on debt issuances are reported as other financing sources while
discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld
from the actual debt proceeds received, are reported as debt service expenditures.
Deferred Inflows of Resources
In addition to liabilities, the statement of financial position will sometimes report a separate section for
deferred inflows of resources. This separate financial statement element, deferred inflows of resources,
represents an acquisition of net position that applies to one or more future periods and so will not be
recognized as an inflow of resources (revenue) until that time. The governmental funds report unavailable
revenues, which arise only under a modified accrual basis of accounting that are reported as deferred
inflows of resources. These amounts are deferred and recognized as an inflow of resources in the period
that the amounts become available. In addition, the City reports deferred inflows of resources for changes
in expected and actual investment returns, assumptions, and benefits provided in its pension plans.
70
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Fund Balances
Governmental funds report nonspendable fund balance for amounts that cannot be spent because they are
either (a) not in spendable form or (b) legally or contractually required to be maintained intact. Restricted
fund balance is reported when externally imposed constraints are placed on the use of resources by
grantors, contributors, or laws or regulations of other governments. Committed fund balance is reported
for amounts that can only be used for specific purposes pursuant to constraints imposed by formal action of
the government's highest level of decision-making authority, the City Council. A formal resolution of the
City Council is required to establish, modify, or rescind a fund balance commitment. The City reports
assigned fund balance for amounts that are constrained by the government's intent to be used for specific
purposes, but are neither restricted nor committed. The City Council has not delegated the authority to
assign fund balance. Unassigned fund balance is the residual classification for the General Fund.
When the City incurs an expenditure for purposes for which various fund balance classifications can be used,
it is the City's policy to use restricted fund balance first, then committed, assigned, and finally unassigned.
Interfund Transactions
During the course of normal operations, the City has numerous transactions between funds, including
expenditures and transfers of resources to provide services, construct assets, and service debt. The
accompanying financial statements generally reflect such transactions as transfers. Operating subsidies are
also recorded as transfers. The amounts recorded as subsidies or advances are determined by the City.
Balances outstanding at year-end are reported as due to/from other funds. Transfers between governmental
or proprietary funds are netted as part of the reconciliation to the government-wide financial statements.
Internal service funds are used to record charges for services to all City departments and funds as transfers
or operating revenue. All City funds record these payments to the internal service funds as transfers or
operating expenditures/expenses.
Pensions
For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of
resources related to pensions, and pension expense, information about the fiduciary net position of the plan
and additions to/deductions from the plan fiduciary net position have been determined on the same basis as
they are reported by the plan. For this purpose, benefit payments (including refunds of employee
contributions) are recognized when due and payable in accordance with the benefit terms. Investments are
reported at fair value.
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles
requires management to make estimates and assumptions that affect certain reported amounts and
disclosures. Accordingly, actual results could differ from those estimates.
The City utilizes various investment instruments which are exposed to various risks, such as interest rate,
credit and overall market volatility. Due to the level of risk associated with certain investment securities, it
is reasonably possible that changes in the values of investment securities will occur in the near-term and
that such changes could materially affect the amounts reported in the financial statements.
71
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
2. BUDGETARY INFORMATION
The City follows these procedures in establishing the budgetary data reflected in the financial statements:
On or before the fourth Monday in March, the Mayor submits to the City Council a proposed operating
budget for the fiscal year commencing the following July 1.
Public hearings are conducted to obtain taxpayer comments.
Not later than the third Monday in May, the Council adopts a budget through passage of a resolution.
The appropriated budget is prepared by fund, department and the mandatory expenditure accounts as
established by the State of Michigan's Uniform Chart of Accounts. Within the General Fund, the legal level
of budgetary control is the mandatory expenditure accounts (personal services, supplies and operating
expenses, capital outlay, debt service, transfers, and contingency) within each department. Within other
funds, the legal level of budgetary control is the mandatory expenditure accounts (personal services,
supplies and operating expenses, capital outlay, debt service, transfers, and contingency) within that fund.
Transfers between appropriations (mandatory accounts) require City Council approval. An exception to City
Council approval is allowed by City Charter for transfers between appropriations (mandatory accounts) for
amounts less than five thousand dollars, but not in excess of 15% of the appropriation in cases where five
thousand dollars exceeds 15% of the appropriation.
Copies of the City's separately issued budget report may be obtained from the Finance Department, 124 West
Michigan Avenue, Lansing, Michigan 48933.
The City formally adopts operating budgets for the General Fund and all special revenue funds.
Budgetary integration is employed as a management control device during the year for all budgeted funds.
Except for the General Fund, these budgets are adopted on a basis consistent with generally accepted
accounting principles ("GAAP"). In the General Fund, capital lease payments / installment payments are
budgeted, but capital lease acquisitions are not. There were no capital lease acquisitions during the year
ended June 30, 2017.
Appropriations lapse at year-end for all annual budgets. Appropriations are automatically carried forward
for project-type budgets.
72
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
P.A. 621 of 1978, as amended, provides that a local unit shall not incur expenditures in excess of the amount
appropriated. During the year ended June 30, 2017, the City incurred expenditures in certain budgetary funds
which were in excess of the amounts appropriated, as follows:
Total Amount of Budget
Appropriations Expenditures Variance
General fund:
General government:
City clerk $ 1,018,700 $ 1,046,228 $ 27,528
Public works 11,032,712 11,200,151 167,439
Nonmajor governmental funds:
State and federal grants fund:
Public works - 1,364 1,364
Transfers out 7,107 7,107
The above budgeted amounts are presented at the activity level, which is the required minimum level of
control per the Michigan Uniform Budget Manual.
3. DEFICIT FUND EQUITY
Governmental activities reported a deficit in unrestricted net position in the amount of $276,760,945 at
June 30, 2017. Total net position amounted to a deficit of $116,263,047, inclusive of $252,315,241 net
pension liability.
The Community Development Block Grant Program Special Revenue Fund reported a deficit unassigned fund
balance of $200,000. Total fund balance (which included $200,000 classified as committed related to a long-
term advance), was $0.
The Special Assessments Capital Projects Fund reported a deficit fund balance of $211,098. The fund
received a long-term advance from the general fund that was used to provide the working capital for the
fund in prior years. The deficit is the result of deferred special assessments receivable. As special
assessments are collected, this deficit will be eliminated, and the advance repaid.
The Cemetery, Golf, Garbage and Rubbish Collection, and Recycling Enterprise Funds reported deficits in
unrestricted fund net position of $889,812, $1,009,079, $2,219,382, and $2,937,706, respectively, as a
result of the net pension liability. Excluding the net pension liability, unrestricted net positions were
$122,456, $57,554, $252,272, and $1,040,375, respectively. Total fund net position amounted to deficits of
$725,193, $2,219,382, and $3,214,898 for the Cemetery, Garbage and Rubbish Collection, and Recycling
funds, respectively. Excluding the net pension liability, total net positions were $296,169 for the Cemetery
fund, $319,747 for the Garbage and Rubbish Collection fund, and $691,434 for the Recycling fund. Total
fund net position for the Golf fund was positive at $1,410,737, inclusive of the net pension liability and the
net investment in capital assets.
73
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
The Tax Increment Finance Authority component unit reported a deficit in unrestricted net position of
$40,390,009 at June 30, 2017. The deficit is a result of full-accrual accounting for long-term debt, without
reflecting a corresponding receivable for tax captures to be received in future periods (which cannot be
accrued in accordance with generally accepted accounting principles).
4. DEPOSITS AND INVESTMENTS
Following is a reconciliation of deposit and investment balances for the primary government (including both
pooled cash and investments as well as pension and other postemployment benefit (OPEB) trust fund
balances) as of June 30, 2017:
Primary Component
Government Units Totals
Statement of net position
Cash and investments $ 66,930,858 $ 4,640,656 $ 71,571,514
Restricted cash and investments 2,563,201 1,108,366 3,671,567
Statement of fiduciary net position
Pension and OPEB trust funds:
Cash and cash equivalents 17,339,063 - 17,339,063
Equity in pooled cash and investments 2,387,484 2,387,484
Investments 539,339,593 539,339,593
Agency funds:
Equity in pooled cash and investments 69,891 69,891
Total $ 628,630,090 $ 5,749,022 $ 634,379,112
Deposits and investments
Bank deposits:
Checking/savings accounts $ 80,180,788
Certificate of deposit (due within one year) 1,712,799
Total bank deposits 81,893,587
Investment in securities and mutual funds:
Pooled investments 12,773,102
Pension and OPEB investments 539,339,593
Total investment in securities and mutual funds 552,112,695
Cash on hand 372,830
Total $ 634,379,112
Custodial Credit Risk - Deposits. Custodial credit risk is the risk that in the event of a bank failure, the
City's deposits may not be returned. State law does not require and the City does not have a policy for
deposit custodial credit risk. As of year-end, $81,199,442 of the City's bank balance of $84,507,163 was
exposed to custodial credit risk because it was uninsured and uncollateralized.
74
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
The City's investment policy does not specifically address this risk, although the City believes that due to
the dollar amounts of cash deposits and the limits of FDIC insurance, it is impractical to insure all bank
deposits. As a result, the City evaluates each financial institution with which it deposits City funds and
assesses the level of risk of each institution; only those institutions with an acceptable estimated risk level
are used as depositories.
Custodial Credit Risk - Investments. As of June 30, 2017, the City's pooled investments consisted entirely of
mutual funds totaling $12,773,102.
For an investment, custodial credit risk is the risk that, in the event of the failure of the counterparty, the
City will not be able to recover the value of its investments or collateral securities that are in the
possession of an outside party. State law does not require and the City does not have a policy for
investment custodial credit risk. On the investments listed above, there is no custodial credit risk, as these
investments are uncategorized as to credit risk.
Credit Risk. State law limits investments to specific government securities, certificates of deposit and
bank accounts with qualified financial institutions, commercial paper with specific maximum maturities and
ratings when purchased, bankers acceptances of specific financial institutions, qualified mutual funds and
qualified external investment pools as identified in the list of authorized investments in the summary of
significant accounting policies. The City's investment policy does not have specific limits in excess of state
law on investment credit risk. Credit risk ratings, where applicable, are summarized as follows:
SItP AAAm $ 11,773,652
SEW Al 999,450
Total $ 12,773,102
Interest Rate Risk. State law limits the allowable investments and the maturities of some of the allowable
investments as identified in the summary of significant accounting policies. The City's investment policy
does not have specific limits in excess of state law on investment maturities as a means of managing its
exposure to fair value losses arising from increasing interest rates. For investments held at year-end
maturities are all due within one year.
Concentration of Credit Risk. Concentration of credit risk is the risk of loss attributed to the magnitude of
the City's investment in a single issuer. State law limits allowable investments but does not limit
concentration of credit risk as identified in the list of authorized investments in the summary of significant
accounting policies. The City's investment policy does not have specific limits in excess of state law on
concentration of credit risk. All investments held at year-end are reported above.
Pension and Other Postemployment Benefit Trust Funds
The deposits and investments of the City's pension and other postemployment benefit trust funds are
maintained separately from the City's pooled cash and investments, and are subject to separate investment
policies and State statutes. Accordingly, the required disclosures for the pension and OPEB deposits and
investments are presented separately.
75
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Deposits
The pension and OPEB trust funds do not maintain any checking or other demand/time deposit accounts.
Amounts reported as cash and cash equivalents in the statement of plan net position are composed entirely
of short-term investments in money market accounts.
Investments
The Michigan Public Employees Retirement Systems' Investment Act, Public Act 314 of 1965, as amended,
authorizes the pension trust funds to invest in stocks, government and corporate securities, mortgages, real
estate, and various other investment instruments, subject to certain limitations. The retirement boards
have the responsibility and authority to oversee the investment portfolio. Various professional investment
managers are contracted to assist in managing the pension trust funds' assets. All investment decisions are
subject to Michigan law and the investment policy established by the retirement boards.
The investments of each pension trust fund are held in a bank administered trust fund. Following is a
summary of pension and other postemployment benefits investments as of June 30, 2017:
Employees' Police and Fire Employees' Retiree
Retirement Retirement Money Purchase Health Care
System System Pension Plan VEBA Totals
Investments
U.S. treasuries:
Not on securities loan $ 3,940,871 $ 7,723,066 $ 12,829 $ $ 11,676,766
On securities loan 4,289,624 2,361,066 - 6,650,690
U.S. agencies:
Not on securities loan 13,715,104 16,955,648 30,670,752
Domestic corporate securities:
Not on securities loan 23,118,949 28,938,240 52,057,189
Domestic equities:
Not on securities loan 30,941,452 62,990,207 93,931,659
On securities loan 13,164,526 20,527,250 33,691,776
International equities:
Not on securities loan 566,526 1,125,761 1,692,287
Emerging markets equities - - 730,520 730,520
Collateralized mortgage
obligations 288,827 335,660 - 624,487
Real estate investment
funds 17,782,043 22,667,186 - - 40,449,229
International equity
mutual funds 64,818,067 94,319,110 108,285 2,761,331 162,006,793
Domestic equity
mutual funds 16,145,838 37,307,229 1,604,644 10,455,722 65,513,433
Domestic debt securities
mutualfunds - - 604,681 11,252,566 11,857,247
International debt securities
mutual funds - 17,421,551 - - 17,421,551
Money market funds 6,141,228 3,506,020 717,966 10,365,214
Total investments $ 194,913,055 $ 316,177,994 $ 2,330,439 $ 25,918,105 $ 539,339,593
76
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Credit Risk. The City's pension investment policies provide that at least 90% of its investments in fixed
income securities be rated BBB- or better by a nationally recognized statistical rating organization and the
remaining 10% be rated at least B- or better. The City's pension and other postemployment benefits
investments were rated by Standard Et Poor's as follows:
Employees' Police and Fire Employees' Retiree
Retirement Retirement Money Purchase Health Care
System System Pension Plan VEBA Totals
AAA $ 158,252 $ 194,733 $ - $ $ 352,985
AA - - 162,842 162,842
A - - 205,940 205,940
BBB+ 11,934,578 17,421,551 - 29,356,129
BBB - - - 11,252,566 11,252,566
BB - - 50,290 - 50,290
US government
guaranteed 21,549,921 26,509,560 - 48,059,481
Not rated 31,385,407 34,678,052 - 66,063,459
Assets not subject
to credit risk 129,884,897 237,374,098 1,911,367 14,665,539 383,835,901
$ 194,913,055 $ 316,177,994 $ 2,330,439 $ 25,918,105 $ 539,339,593
Custodial Credit Risk. For investments, custodial credit risk is the risk that, in the event of the failure of
the counterparty, the City will not be able to recover the value of its investments or collateral securities
that are in the possession of an outside party. The City's pension investment policies require that
investment securities be held in trust by a third-party institution in the name of the pension trust fund. As
such, although uninsured and unregistered, the City's pension investments are not exposed to custodial
credit risk since the securities are held by the counterparty's trust department in the name of the pension
trust fund. Short-term investments in money market funds and open-end mutual funds are not exposed to
custodial credit risk because their existence is not evidenced by securities that exist in physical or book
form.
Concentration of Credit Risk. At June 30, 2017, the pension and other postemployment benefits investment
portfolio was concentrated as follows:
Employees' Police and Fire
Retirement Retirement
Investment Type Issuer System System
Corporate bonds Western Asset Funds, Inc. 11.9% 9.2%
Common stock Northern Trust Bank, N.A. 8.3% 11.8%
77
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
The City's pension and other postemployment benefits investment policies require diversification of fixed
income securities; however, they do not specify percentages of dollar amounts by industry or issuer.
Foreign Currency Risk. Foreign currency risk is the risk that changes in exchange rates will adversely affect
the fair value of an investment or deposit. The pension and other postemployment benefits trusts' exposure
to foreign currency risk is as follows:
Employees' Police and Fire Employees' Retiree
Investment Retirement Retirement Money Purchase Health Care
(currency in U.S, dollar) System System Pension Plan VEBA Totals
International equities:
Canada $ 332,606 $ 639,222 $ $ $ 971,828
Peru 9,662 21,263 30,925
The Netherlands 15,246 33,881 49,127
United Kingdom 163,934 333,803 497,737
France 45,077 97,593 142,670
International mutual funds 64,818,067 111,740,661 108,285 2,761,331 179,428,344
Total $ 65,384,592 $ 112,866,423 $ 108,285 $ 2,761,331 $ 181,120,631
Interest Rate Risk. Interest rate risk is the risk that changes in interest rates will adversely affect the fair
market value of an investment. The City's pension investment policies provide that the average duration of
fixed income securities shall not deviate from the Lehman Brothers Aggregate Index duration by +/-20%. As
of June 30, 2017, maturities of the City's pension and other postemployment benefits trust debt securities
and collateralized mortgage obligations were as follows:
Investment Maturities (Fair Value)
Less than More than
1 year 1-5 years 6-10 years 10 years Total
Employees' Retirement
System
U.S. agencies $ - $ 866,310 $ - $ - $ 866,310
U.S. government bonds 1,524,255 3,215,907 2,310,046 1,180,287 8,230,495
U.S. government mortgage
backed securities 18 144,714 1,764,102 7,228,662 9,137,496
U.S. government issued
commercial mortgage
backed securities 185,348 62,313 1,386,524 623,462 2,257,647
Commercial mortgage
backed securities - - 72,051 216,776 288,827
Total $ 1,709,621 $ 4,289,244 $ 5,532,723 $ 9,249,187 $ 20,780,775
78
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Investment Maturities (Fair Value)
Less than More than
1 year 1-5 years 6-10 years 10 years Total
Police and Fire Retirement
System
U.S. agencies $ - $ 1,144,978 $ - $ - $ 1,144,978
U.S. government bonds 2,161,250 5,134,878 1,421,412 1,366,592 10,084,132
U.S. government mortgage
backed securities 1,861 217,599 1,100,726 10,279,565 11,599,751
U.S. government issued
commercial mortgage
backed securities 277,855 63,464 1,762,125 782,099 2,885,543
Commercial mortgage
backed securities - - 92,637 243,023 335,660
Total $ 2,440,966 $ 6,560,919 $ 4,376,900 $ 12,671,279 $ 26,050,064
Securities Lending. Under contracts approved by the City, the pension and other postemployment benefits
trust funds are permitted to lend their securities to broker-dealers and banks (borrowers) for collateral that
will be returned for the same securities in the future. The pension trust and other postemployment benefits
funds' custodial banks manage the securities lending programs and receive cash as collateral. Collateral
cash is initially pledged at 100% of the fair value of the securities lent, and may not fall below 95% of the
market value of the loaned security during the term of the loan. At all times, collateral cannot be more
than $100,000 less than the market value of the loaned security. There are no restrictions on the amount of
securities that can be loaned.
Securities on loan at year-end are classified in the preceding schedule of custodial credit risk according to
the category for the collateral received on the securities lent. At year-end, the pension trust funds have no
credit risk exposure to borrowers because the collateral held by the custodians exceeds the market value of
the related securities lent. At June 30, 2017, the fair value of securities on loan by the Employees'
Retirement System and the Police and Fire Retirement System were $17,454,150 and $22,888,316,
respectively, for which the Plans' received cash collateral of $17,865,560 and $23,422,689, respectively.
The contract with the pension and other postemployment benefits trust fund custodians require them to
indemnify the City if the borrowers fail to return the securities (and if the collateral is inadequate to
replace the securities lent) or fail to pay the City for income distributions by the securities' issuers while
the securities are on loan.
Fair Value Measurement
The City categorizes its fair value measurements within the fair value hierarchy established by generally
accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair
value of the asset, as determined by the City's investment advisors. Level 1 inputs are quoted prices in
active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are
significant unobservable inputs.
79
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
The City has the following recurring fair value measurements as of June 30, 2017:
Level Level Level Total
U.S. agencies $ $ 18,327,456 $ $ 18,327,456
U.S. government bonds 30,670,752 30,670,752
Collateralized mortgage
obligations 624,487 - 624,487
Mutualfunds 283,836,845 38,447,590 322,284,435
Domestic equities 107,503,182 - 107,503,182
International equities 1,692,287 1,692,287
Emerging equities 20,850,773 - 20,850,773
Commercial paper - 999,450 999,450
Money market funds 10,365,214 11,773,652 22,138,866
$ 424,872,788 $ 100,218,900 $ 525,091,688
Investments carried at net asset value:
Equity funds 25,019,368
Private equity partnerships 2,001,639
Total investments $ 552,112,695
Net Asset Value Investments. Certain investments noted above are carried at net asset value as these are
not actively traded. The fair value is estimated based on the dollar value per share as of June 30, 2017.
These investments are able to be liquidated as needed, to the extent there is a willing buyer in the market.
There are not any restrictions related to the sale of these investments. At June 30, 2017, the City had
$2,777,958 outstanding on initial commitments of $8,600,000 with the Invesco Mortgage Recovery Fund (the
"Fund"). The Fund has a seven year life, and the intent is to sell all of the investments prior to the Fund's
maturity. The other investments at net asset value do not contain required redemption periods.
5. RECEIVABLES
Receivables are comprised of the following:
Governmental Business-type Component
Activities Activities Units
Accounts receivable $ 8,555,248 $ 15,620,083 $ 1,181,925
Taxes receivable 240,272 - -
Special assessments receivable 288,878 -
Loans receivable 1,426,440 - 241,658
Accrued interest receivable 2,355,617 135,280 -
Due from other governments 14,449,412 - 985
Lease receivable - 22,893,782 -
Allowance for uncollectible accounts (608,455) (339,790)
$ 26,707,412 $ 38,309,355 $ 1,424,568
Amount not expected to be
collected within one year $ 3,822,675 $ 22,250,994 $ 237,158
80
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
The Brownfield Redevelopment Authority component unit is also party to loan agreements in which the
associated loans are expected to be repaid by future collections of tax increment revenues related to the
properties being cleaned up. The liability of the local corporations is limited to any shortfalls in future
collection of tax increment revenues. Because these balances are not expected to be collected from outside
parties, no balance is reported in the Brownfield Redevelopment Authority statements. The outstanding
balance of such loans at June 30, 2017 consisted of the following:
Brownfield Revolving Loan Fund loan to Michigan Avenue Investors, LLC for cleanup related to
a former gas station. Interest is accreted at 2.0% per annum. $ 55,075
Brownfield Revolving Loan Fund loan to Brownfield Development Specialists, LLC for cleanup
related to the "bard Building" in the City. Interest is stated at 0%. 250,000
Brownfield Revolving Loan Fund loan to Y Site, LLC for cleanup related to the former YMCA
building. Interest is accreted at 3.0% per annum. 118,635
Brownfield Revolving Loan Fund loan to the High Grade Material Company for demolition and
cleanup related to a single parcel of property in the City. Interest is accreted at 5.0% per
annum. 86,325
Brownfield Cleanup Revolving Loan Fund loan to the City of Lansing Economic Development
Corporation related to property formerly owned by the City of Lansing Board of Water and
Light. Interest is stated at 0%. 409,096
Brownfield Revolving Loan Fund loan receivable to the City for cleanup related to a single
parcel to be converted into a City parking lot. Interest is stated at 0%. 400,000
Brownfield Revolving Loan Fund loan receivable to the City for cleanup related to a
redevelopment of the former Potter Mill property. Interest is stated at 0%. 200,000
Brownfield Revolving Loan Fund loan receivable to the City for cleanup related to
redevelopment of the south side of the 2000 block of East Michigan Avenue. Interest is stated
at 3%. 151,738
$ 1,670,869
81
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
6. CAPITAL ASSETS
Capital asset activity for the year ended June 30, 2017 was as follows:
Beginning Ending
Balance Additions Disposals Transfers Balance
Governmental activities
Capital assets, not being depreciated:
Land $ 25,838,193 $ 58,346 $ (16,350) $ - $ 25,880,189
Construction in progress 665,119 - (665,119) -
26,503,312 58,346 (16,350) (665,119) 25,880,189
Capital assets, being depreciated:
Land improvements 19,945,351 848,128 665,119 21,458,598
Equipment and vehicles 37,596,867 2,673,127 (2,346,576) - 37,923,418
Buildings 136,275,787 - 136,275,787
Infrastructure 301,996,447 2,977,633 (2,436,381) - 302,537,699
495,814,452 6,498,888 (4,782,957) 665,119 498,195,502
Less accumulated depreciation for:
Land improvements (9,660,294) (829,977) - - (10,490,271)
Equipment and vehicles (30,820,173) (2,109,442) 2,298,190 (30,631,425)
Buildings (77,387,271) (4,426,156) - (81,813,427)
Infrastructure (210,262,741) (4,506,657) 2,436,381 (212,333,017)
(328,130,479) (11,872,232) 4,734,571 - (335,268,140)
Total capital assets
being depreciated, net 167,683,973 (5,373,344) (48,386) 665,119 162,927,362
Governmental activities
capital assets, net $ 194,187,285 $ (5,314,998) $ (64,736) $ - $ 188,807,551
At June 30, 2017, the City's governmental activities had outstanding commitments through construction
contracts of approximately $3,257,000.
82
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Beginning Ending
Balance Additions Disposals Transfers Balance
Business-type activities
Capital assets, not being depreciated:
Land $ 13,483,910 $ - $ (191,419) $ - $ 13,292,491
Construction in progress 11,987,145 2,804,043 (5,926,556) 8,864,632
25,471,055 2,804,043 (191,419) (5,926,556) 22,157,123
Capital assets, being depreciated:
Land improvements 25,336,226 - 25,336,226
Equipment and vehicles 7,124,067 226,596 (17,600) - 7,333,063
Buildings 216,947,922 - 373,100 217,321,022
Sewers 336,118,519 660,602 5,553,456 342,332,577
585,526,734 887,198 (17,600) 5,926,556 592,322,888
Less accumulated depreciation for:
Land improvements (13,775,046) (554,974) - - (14,330,020)
Equipment and vehicles (5,739,157) (407,999) 17,600 (6,129,556)
Buildings (124,701,620) (4,596,608) - (129,298,228)
Sewers (95,246,003) (6,880,927) - (102,126,930)
(239,461,826) (12,440,508) 17,600 (251,884,734)
Total capital assets
being depreciated, net 346,064,908 (11,553,310) - 5,926,556 340,438,154
Business-type activities
capital assets, net $ 371,535,963 $ (8,749,267) $ (191,419) $ - $ 362,595,277
At June 30, 2017, the City's business-type activities had outstanding commitments through construction
contracts of approximately $1,496,000.
Depreciation expense was charged to functions/programs of the primary government as follows:
Depreciation of governmental activities by function
General government $ 429,527
Public safety 486,559
Public works 4,509,719
Recreation and culture 2,700,280
Community development 1,812,352
Internal service funds 1,933,795
Total depreciation expense - governmental activities $ 11,872,232
Depreciation of business-type activities by function
Sewage disposal system $ 10,316,607
Municipal parking system 1,739,900
Cemetery 10,694
Golf 72,295
Recycling 301,012
Total depreciation expense - business-type activities $ 12,440,508
83
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
7. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
Accounts payable and accrued liabilities are comprised of the following:
Governmental Business-type Component
Activities Activities Units
Accounts payable $ 5,942,337 $ 1,392,570 $ 1,085,861
Deposits payable 102,376 66,715 -
Accrued payroll 1,668,793 151,462 165,145
Contract retainage payable 499,996 80,268 -
Due to other governments 2,105,286 -
Other 1,756,616 - -
$ 12,075,404 $ 1,691,015 $ 1,251,006
8. INTERFUND RECEIVABLES, PAYABLES AND TRANSFERS
The composition of interfund balances as of June 30, 2017, was as follows:
Due to and from primary government funds
Due from Due to Other
Other Funds Funds
Nonmajor governmental funds $ - $ 1,600,000
Sewage disposal system 1,600,000 359,928
Municipal parking system 362,870 2,942
Total $ 1,962,870 $ 1,962,870
The above balances generally resulted from a time lag between the dates that interfund goods and services
are provided or reimbursable expenditures occur, transactions are recorded in the accounting system, and
payments between funds are made.
Advances to and from primary government funds
Advances to Advances from
Other Funds Other Funds
Nonmajor governmental funds $ - $ 257,477
Municipal parking system 257,477 -
Total $ 257,477 $ 257,477
Advances are made to the Special Assessments Fund to prevent a negative equity in pooled cash.
84
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Due to and from component units
Due from Due to Due from
primary component Due to primary component
government unit government unit
Sewage disposal system $ - $ 1,408,365 $ $ 1,109,931
Brownfield redevelopment authority 1,408,365 - -
Tax increment finance authority - - 1,109,931
Total $ 1,408,365 $ 1,408,365 $ 1,109,931 $ 1,109,931
The above balances generally resulted from a time lag between the dates that interfund goods and services
are provided or reimbursable expenditures occur, transactions are recorded in the accounting system, and
payments between funds are made.
For the year ended June 30, 2017, interfund transfers consisted of the following:
Transfers In
Nonmajor Nonmajor Internal
governmental enterprise service
Transfers Out General fund funds funds funds Total
General fund $ - $ 6,551,433 $ - $ 1,650,000 $ 8,201,433
Nonmajor governmental funds 220,338 1,990,416 1,085,749 - 3,296,503
Sewage disposal system 300,000 - - 300,000
Nonmajor enterprise funds - 39,540 39,540
Internal service funds - 785,900 - - 785,900
Total $ 520,338 $ 9,367,289 $ 1,085,749 $ 1,650,000 $ 12,623,376
Transfers are used to: (1) move revenues from the fund that is required to collect them to the fund that is
required or allowed to expend them; (2) move receipts restricted to or allowed for debt service from the
funds collecting the receipts to the debt service fund as debt service payments become due; and (3) use
unrestricted revenues collected in the General Fund to finance various programs accounted for in other
funds in accordance with budgetary authorizations.
85
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
9. LONG-TERM DEBT
General obligation bonds. The government issues general obligation bonds to provide funds for the
acquisition and construction of major capital facilities. General obligation bonds are direct obligations and
pledge the full faith and credit of the government. These bonds are issued as 10 to 30-year serial bonds
with varying amounts of principal maturing each year. General obligation bonds currently outstanding are as
follows:
Interest Original
General obligation bonds Rate Amount Amount
Governmental activities:
2007 Fire Station Refunding Bonds - Unlimited Tax 3.625-5.00% $ 1,780,000 $ 395,000
2008 Michigan Transportation Fund Bonds - Limited Tax 3.00-4.00% 3,500,000 510,000
2009 Capital Improvement Bonds - Limited Tax 3.15-6.85% 10,197,000 8,535,000
2010 Fire Station Refunding Bonds - Unlimited Tax 2.60-2.65% 2,470,000 610,000
2013 Energy Efficiently Refunding Bonds - Limited Tax 2.40% 5,645,000 3,880,000
2010 Recovery Zone Economic Development Bonds 3.40-7.25% 3,200,000 2,485,000
2015 Building Authority Firing Range Bonds - Limited Tax 2.00% 320,000 160,000
2015 Lansing Center Refunding Bonds - Limited Tax 2.00-3.00% 1,770,000 1,490,000
$ 28,882,000 $ 18,065,000
Business-type activities:
2009 Building Authority Refunding Bonds - Limited Tax 6.014-6.584% $ 8,161,691 $ 8,161,691
2012 Building Authority Refunding Bonds - Limited Tax 0.55-3.70% 7,200,000 5,600,000
2007 Building Authority Refunding Bonds - Limited Tax 3.625-5.00% 7,965,000 6,890,000
2014 Building Authority Refunding Bonds - Limited Tax 4.75% 7,245,000 7,245,000
1996 Limited Tax Sewer Bond - 5005-08 2.25% 3,995,000 245,000
1997 Limited Tax Sewer Bond - 5005-09 2.25% 4,746,780 561,780
1998 Limited Tax Sewer Bond - 5005-10 2.25% 10,539,950 1,859,950
1999 Limited Tax Sewer Bond - 5005-11 2.50% 10,120,000 1,860,000
2000 Limited Tax Sewer Bond - 5005-12 2.50% 9,447,830 2,247,830
2001 Limited Tax Sewer Bond - 5005-13 2.50% 10,573,046 3,123,046
2002 Limited Tax Sewer Bond - 5005-14 2.50% 12,381,131 4,946,131
2003 Limited Tax Sewer Bond - 5005-15 2.50% 10,145,688 4,645,688
2004 Limited Tax Sewer Bond - 5005-16 2.13% 3,842,649 1,892,649
2005 Limited Tax Sewer Bond - 5005-17 2.13% 8,003,778 3,903,778
2005 Limited Tax Sewer Bond - 5005-18 1.63% 13,389,371 6,789,371
2006 Limited Tax Sewer Bond - 5005-19 1.63% 18,216,346 10,511,346
2007 Limited Tax Sewer Bond - 5005-20 1.63% 24,244,726 14,959,726
2008 Limited Tax Sewer Bond - 5005-21 2.50% 27,494,933 19,285,453
2008 Limited Tax Sewer Bond - 5005-22 2.50% 14,455,604 11,405,604
2009 Capital Improvement Bonds 4.10-7.05% 9,803,000 8,890,000
2010 Limited Tax Sewer Bond - 5411-01 2.50% 8,548,000 7,103,000
2015 Limited Tax Sewer Bond - 5211-01 2.50% 3,372,405 3,102,405
86
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Interest Original
General obligation bonds (concluded) Rate Amount Amount
Business-type activities (concluded):
2015 Limited Tax Sewer Bond - 5211-02 2.50% $ 1,977,487 $ 1,792,487
2016 Limited Tax Sewer Bond - 5581-01 2.50% 1,309,872 1,309,872
2014 Building Authority Refunding Bonds - Limited Tax 2.00-3.00% 6,765,000 5,685,000
$ 243,944,287 $ 144,016,807
As of June 30, 2017, the Tax Increment Financing Authority component unit had defeased bonds outstanding
consisting of $6,430,000 related to the 1990 Tax Increment Finance Authority Bonds. This amount is
scheduled to be paid by the escrow agent in installments on May 1 of years 2018 through 2020.
Revenue bonds. The City also issues bonds where the income derived from the acquired or constructed
assets is pledged to pay debt service. Revenue bonds outstanding at year-end are as follows:
Interest Original
Rate Amount Amount
Revenue bonds - business type activities
2013 Sewer Revenue and Refunding Bond 2.40% $ 21,765,000 $ 17,175,000
Pledged revenues. The City has pledged future sewer customer revenues, net of specified operating
expenses, to repay $21,765,000 in sewer revenue and refunding bonds issued in 2013. Proceeds from the
bonds provided financing for the construction for various sewer infrastructure projects. The bonds are
payable solely from sewer customer net revenues and are payable through 2028. Annual principal and
interest payments on the bonds are expected to require less than 14% of net revenues. The total principal
and interest paid for the current year and total customer net revenues were $2,349,188 and $21,210,052
respectively.
Installment purchase agreements. The government enters into installment purchase agreements for
equipment and related capital assets. Installment purchase agreements outstanding at year-end are as
follows:
Interest Original
Rate Amount Amount
Installment purchase agreements
Governmental activities:
2013 Lease Purchase Agreement - Garage 2.40% $ 1,892,332 $ 397,180
2014 Lease Purchase Agreement - Recycling Trucks 1.96% 1,550,855 919,003
2015 Ballpark Improvements Installment Purchase 3.00% 13,500,000 12,357,999
2014 Installment Purchase Agreement - Police Cars 1.44% 491,241 83,349
$ 17,434,428 $ 13,757,531
Business-type activities:
2014 Lease Purchase Agreement - Recycling Carts 1.96% $ 1,737,000 $ 1,029,723
87
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Loans payable. The government has entered into loan agreements with the certain State agencies for
program purposes. Loans payable at year-end are as follows:
Interest Original
Rate Amount Amount
Loans payable
Governmental activities:
HUD Section 108 Loan 1.52% $ 5,900,000 $ 5,900,000
2014 SIB Loan 3.00% 1,828,428 1,828,428
$ 7,728,428 $ 7,728,428
Changes in long-term debt. Long-term liability activity for the year ended June 30, 2017, was as follows:
Beginning Ending Due Within
Balance Additions Reductions Balance One Year
Governmental activities
General obligation bonds $ 21,900,000 $ $ 3,835,000 $ 18,065,000 $ 2,735,000
Installment purchase
agreements 15,268,317 1,510,786 13,757,531 1,468,135
Loans payable 7,872,600 144,172 7,728,428 251,883
Total installment debt 45,040,917 5,489,958 39,550,959 4,455,018
Deferred amounts:
For issuance discounts (72,988) (6,834) (66,154) -
For issuance premiums 141,318 60,124 81,194 -
Compensated absences 9,552,788 1,129,805 957,174 9,725,419 957,174
Accrued workers
compensation 2,297,914 952,439 832,573 2,417,780 535,903
$ 56,959,949 $ 2,082,244 $ 7,332,995 $ 51,709,198 $ 5,948,095
Business-type activities
General obligation bonds $ 154,534,187 $ 1,767,693 $ 12,285,073 $ 144,016,807 $ 12,245,000
Revenue bonds 18,725,000 - 1,550,000 17,175,000 1,550,000
Installment purchase
agreements 1,246,673 - 216,950 1,029,723 221,223
Total installment debt 174,505,860 1,767,693 14,052,023 162,221,530 14,016,223
Deferred amounts:
For issuance discounts (636,356) - (73,009) (563,347) -
For issuance premiums 2,351,867 - 236,165 2,115,702 -
Compensated absences 759,258 78,398 42,826 794,830 42,826
$ 176,980,629 $ 1,846,091 $ 14,258,005 $ 164,568,715 $ 14,059,049
88
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
For the governmental activities, compensated absences and other long-term debt are generally liquidated
by the General Fund.
Debt service requirements to maturity for all installment debt of the City are as follows:
Year Governmental Activities Business-type Activities
Ending
June 30 Principal Interest Total Principal Interest Total
2018 $ 4,455,018 $ 1,311,523 $ 5,766,541 $ 14,016,223 $ 18,432,636 $ 32,448,859
2019 3,544,919 1,204,862 4,749,781 14,127,360 16,519,062 30,646,422
2020 3,245,527 1,097,291 4,342,818 14,134,973 14,547,454 28,682,427
2021 3,762,075 995,597 4,757,672 15,195,326 12,547,747 27,743,073
2022 3,452,029 881,508 4,333,537 14,659,019 10,477,005 25,136,024
2023-2027 12,351,190 2,964,949 15,316,139 55,983,736 36,185,575 92,169,311
2028-2032 8,195,201 708,769 8,903,970 24,912,001 15,450,579 40,362,580
2033-2037 545,000 9,810 554,810 7,122,892 7,508,386 14,631,278
2038-2042 - - - 2,070,000 2,293,014 4,363,014
$ 39,550,959 $ 9,174,309 $ 48,725,268 $ 162,221,530 $ 133,961,458 $ 296,182,988
Long-term debt disclosures, as applicable, for the City's component units are available in the separately
issued financial statements.
10. FUND BALANCES - GOVERNMENTAL FUNDS
In accordance with GASB Statement No. 54, Fund Balance Reporting and Governmental Fund Type
Definitions, the City classifies fund balances based primarily on the extent to which it is bound to observe
constraints imposed upon the use of the resources reported in governmental funds. Detailed information on
fund balances of governmental funds is as follows:
Nonmajor
General Governmental
Fund Funds Totals
Nonspendable
Inventories $ 20,513 $ 805,025 $ 825,538
Prepaids 7,829 5,468 13,297
Corpus of permanent fund - 1,808,391 1,808,391
28,342 2,618,884 2,647,226
Restricted
Major and local streets - 2,895,524 2,895,524
Drug law and narcotics
enforcement 1,459,792 1,459,792
Building permit activity 197,707 197,707
Capital improvements (unexpended
bond proceeds) 175,989 175,989
4,730,012 4,730,012
89
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Nonmajor
General Governmental
Fund Funds Totals
Committed
Police and fire services $ 130,441 $ - $ 130,441
By ordinance (budgetcarryforwards) 254,626 4,593,220 4,847,846
Community development - 200,000 200,000
Shopping district events and maintenance 31,811 31,811
City parks 471,568 471,568
Capital improvements - 5,130,362 5,130,362
385,067 10,426,961 10,812,028
Unassigned (deficit) 15,283,857 (411,098) 14,872,759
Total fund balances -
governmental funds $ 15,697,266 $ 17,364,759 $ 33,062,025
11. NET INVESTMENT IN CAPITAL ASSETS
The composition of net investment in capital assets as of June 30, 2017, was as follows:
Governmental Business-type Component
Activities Activities Units
Capital assets:
Capital assets not being depreciated $ 25,880,189 $ 22,157,123 $ -
Capital assets being depreciated, net 162,927,362 340,438,154 2,768
Total capital assets 188,807,551 362,595,277 2,768
Related debt:
General obligation bonds 18,065,000 144,016,807 -
Revenue bonds - 17,175,000
Installment purchase agreements 13,757,531 1,029,723
Loans payable 7,728,428 -
Unamortized bond discounts (66,154) (563,347)
Unamortized bond premiums 81,194 2,115,702
Deferred charge on bond refunding (116,407) (2,446,570)
Amounts under leases receivable - (22,893,782)
Unexpended bond proceeds (175,989) -
Totalrelated debt 39,273,603 138,433,533 -
Net investment in capital assets $ 149,533,948 $ 224,161,744 $ 2,768
12. SEGMENT INFORMATION - ENTERPRISE FUNDS
The government issued revenue bonds to finance certain improvements to its sewage disposal system.
Because the Sewage Disposal System, an individual fund that accounts entirely for the government's sewage
activities, is a segment and is reported as a major fund in the fund financial statements, separate segment
disclosures herein are not required.
90
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
13. RISK MANAGEMENT
The City of Lansing, Michigan is exposed to various risks of loss related to property loss, torts, errors and
omissions and employee injuries.
The City carries commercial insurance for claims relating to general liability, property, electronic data
processing, boiler and machinery, police professional and errors and omissions. The City has not
experienced settlements in excess of insurance coverage during the past three years. The City is uninsured
for acts of nature and environmental clean-up costs.
The City is self-funded for Blue Cross Blue Shield healthcare coverage for employees and retirees. The City
maintains stop/loss coverage that limits its per-case exposure to $250,000. The City estimates healthcare
claims that are incurred but not reported as of year-end, which is accounted for in the City's Fringe Benefits
Internal Service Fund. Changes in the estimated liability were as follows:
Fiscal Year Ended June 30,
2017 2016
Estimated liability, beginning of year $ 656,064 $ 704,905
Estimated claims incurred,
including changes in estimates 9,903,853 9,812,124
Claim payments (9,674,917) (9,860,965)
Estimated liability, end of year $ 885,000 $ 656,064
The City is self-insured for workers' compensation costs. The City estimates the liability for workers'
compensation claims that have been incurred through the end of the fiscal year, including those claims that
have been reported as well as those that have not yet been reported to the City. The current liability is
accounted for in the General Fund, with long-term liabilities accounted for in the Statement of Net
Position. The City has liability insurance coverage up to a maximum amount of $16,000,000 per occurrence
with a $350,000 deductible. Changes in the estimated long-term liability as well as the total estimated cost
of claims for the past two fiscal years were as follows:
Fiscal Year Ended June 30,
2017 2016
Estimated liability, beginning of year $ 2,297,914 $ 3,418,805
Estimated claims incurred,
including changes in estimates 952,439 184,364
Claim payments (832,573) (1,305,255)
Estimated liability, end of year $ 2,417,780 $ 2,297,914
91
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
14. PROPERTY TAXES
Property taxes attach as an enforceable lien on property as of the date they are levied. City, community
college, and 50% of school taxes are levied and due July 1 and become delinquent after August 31. County
taxes and the balance of school taxes are levied and due December 1 and become delinquent after February
14. In March, taxes on real property still delinquent are purchased by the County's tax revolving funds.
Collections of community college, school, and county taxes and remittances are accounted for in the
general fund. City property tax revenues are recognized in the fiscal year for which the taxes are levied to
the extent that they result in current receivables (i.e., are collected within 60 days after fiscal year-end).
The City is permitted by charter and state law to levy taxes up to $20.00 per $1,000 of assessed valuation
for general operations other than the payment of principal and interest on long-term debt. The tax rate to
finance general governmental services other than the payment of principal and interest on long-term debt
for the year ended June 30, 2017 was $19.44 per $1,000 of taxable value.
15. CONTINGENT LIABILITIES
Federal Grant Programs. Amounts received or receivable from grantor agencies are subject to audit and
potential adjustment by grantor agencies, principally the federal government. Any disallowed claims,
including amounts already collected, may constitute a liability of the applicable funds. The amount, if any,
of expenditures which may be disallowed by the grantor cannot be determined at this time although the
government expects such amounts, if any, to be immaterial.
Risk Management. The government is a defendant in various lawsuits. Although the outcome of these
lawsuits is not presently determinable, it is the opinion of the government's counsel that resolution of these
matters will not have a material adverse effect on the financial condition of the government.
16. PENSION PLANS
Employees'Retirement *stem
Plan Description. The City sponsors and administers the Employees' Retirement System (the "Plan"), a
single-employer, defined benefit pension plan that covers general full-time employees of the City of
Lansing, Michigan and employees of the 54-A District Court. It does not include elected officials, who are
members of the Employees' Money Purchase Pension Plan, nor does it include police officers and
firefighters, who are members of a separate City defined benefit pension plan. The Plan was established
and may be amended by the City Council and is administered by a nine member Board of Trustees. The
Board is comprised of the Mayor of the City, one member of the City Council appointed by the City Council,
the City Treasurer, the City Human Resources Director, three members of the retirement system to be
elected by the members of the system under rules adopted by the board, two residents of the State of
Michigan appointed by the Mayor, by and with the consent of the City Council, one of which is a retiree of
the retirement system. It is accounted for as a separate pension trust fund. Separate financial statements
are not issued for the Plan.
92
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
All members may retire at age 50 with 25 or more years of credited service, or age 58 with 8 or more years
of credited service. Members are vested after completing 8 years of credited service. Retirement options
that provide for survivor benefits are available to members. The plan also provides death and disability
benefits. If a member leaves employment or dies before vesting, accumulated member contributions plus
interest are refunded to the member or designated beneficiary. Members who are vested and terminate
their employment prior to retirement will receive their benefit as a life annuity beginning at age 58.
Summary of Significant Accounting Policies. The financial statements of the Plan are prepared using the
accrual basis of accounting. Plan member contributions are recognized in the period which the contributions
are due. The City's contributions are recognized when due and a formal commitment to provide the
contribution has been made. Benefits and refunds are recognized when due and payable in accordance with
the terms of the Plan. Administration of the Plan is funded through the Plan's investment earnings.
Method Used to Value Investments. Plan investments are reported at fair value. Short-term investments are
reported at cost, which approximates fair value. Securities traded on a national or international exchange
are valued at the last reported sales price at current exchange rates. Investments for which market
quotations are not readily available are valued at their fair values as determined by the custodian under the
direction of the Plan Board of Trustees, with the assistance of a valuation service.
Plan Membership. At December 31, 2016, plan membership consisted of the following:
Retirees and beneficiaries currently receiving benefits 903
Terminated employees entitled to but not yet receiving benefits 147
Vested and non-vested active participants 377
Total membership 1,427
Benefits Provided. Employees who retire with minimum age and years of service requirements are entitled
to annual retirement benefits, payable in monthly installments for life, in an amount equal to a percentage
of their final average compensation times years of credited service. Final average compensation is defined
as the average of the highest annual compensation paid over 2 consecutive years of credited service within
the last 10 years of credited service immediately preceding a member's termination of employment. The
benefit payments are calculated using the following rates for the various groups of general employees:
Bargaining Unit/Employee Multiplier
Group Percentage
United Auto Workers (UAW):
Hired after October 18, 2013 1.70%
All others 2.75%
Teamsters Local 214:
Hired after September 2012 1.25%
All others 1.80%
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CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Bargaining Unit/Employee Multiplier
Group Percentage
Teamsters Local 580:
Hired after May 19, 2014 1.25%
All others 1.80%
Non-bargaining and all others
Hired after April 1, 2014 1.25%
All others 1.60%
District court exempt
Hired after June 1, 2014 1.25%
All others 1.60%
Contributions. The contribution requirements of Plan members are established and may be amended by the
City Council in accordance with City policies, union contracts, and Plan provisions. Employees are required
to make contributions to the Plan in rates from 3.00 to 6.50% depending on bargaining unit and hire date.
The City is required to contribute at actuarially determined rates expressed as a percentage of covered
payroll. The City's contribution rate for the plan for the year ended June 30, 2017 was 49.0% of projected
valuation payroll.
Bargaining Unit/Employee Contribution
Group Percentage
United Auto Workers (UAW) 3.00%
Teamsters Local 214:
Hired after September 2012 5.00%
All others 6.50%
Teamsters Local 580:
Hired after May 9, 2014 5.00%
All others 6.35%
District court Teamsters:
Hired after April 2014 5.00%
All others 5.50%
District court exempt 5.50%
All others 6.50%
Investment Policy. The plan's policy in regard to the allocation of invested assets is established and may be
amended by the Board of Trustees. The investment policy has been formulated based on consideration of a
wide range of policies and describes the prudent investment process that the Board deems appropriate. The
Plan's asset allocation policy is shown on the following pages.
Rate of Return. For the year ended June 30, 2017, the annual money-weighted rate of return on pension
plan investments, net of pension plan investment expense, was 10.91%. The money-weighted rate of return
expresses investment performance, net of investment expense, adjusted for the changing amounts actually
invested.
94
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Concentrations. At June 30, 2017, the Plan held certain investments (other than those issued or explicitly
guaranteed by the U.S. government, mutual funds, external investment pools, or other pooled investments)
in certain organizations that represent 5% or more of the Plan's fiduciary net position. Please see Footnote
4 for the details of these concentrations.
Reserves. In accordance with the Plan policy, the City establishes reserves for various purposes. The
reserves are adjusted annually based on recommendations from the City's actuaries. The policy for creating
and adjusting reserves was established and can be amended by the Plan Board of Trustees. A summary of
the Plan reserves at June 30, 2017 is as follows:
Reserve/Group Balance
Employee savings fund $ 13,317,143
Retirement reserve fund 134,192,860
Pension accumulation fund 6,307,806
Members benefit fund 16,147,631
Health insurance fund 28,762,532
Net Pension Liability. The components of the net pension liability for the employees' retirement system at
June 30, 2017 were as follows:
Total pension liability $ 307,450,034
Plan fiduciary net position 169,965,440
Net pension liability $ 137,484,594
Plan fiduciary net position as
percentage of total pension
liability 55.28%
Actuarial Assumptions. The total pension liability was determined by an actuarial valuation as of December
31, 2016, rolled forward to June 30, 2017, using the following actuarial assumptions, applied to all periods
included in the measurement:
Inflation 2.925% (previous year: 3.10%)
Salary increases 2.925%, plus service based increases (previous
year: 3.10%)
Investment rate of return 7.40%, net of investment expense and including
inflation (previous year: 7.60%)
Mortality is based on the RP-2000 tables for males and females. For Disabled members, the disabled
versions of these tables are used. Each of these tables is projected to 2026 using Scale BB and a 50% factor
is applied for pre-retirement deaths.
The actuarial assumptions used in the December 31, 2016 valuation were based on the results of actuarial
experience analysis conducted in December 2016. There was a change in the discount rate due to a higher
bond rate.
95
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
The long-term expected rate of return on pension plan investments was determined using a building-block
method in which best-estimates of expected future real rates of return (expected returns, net of pension
plan investment expense and inflation) are developed for each asset class. These ranges are combined to
produce the long-term expected rate of return by weighting the expected future real rates of return by the
target asset allocation percentage and by adding expected inflation. This is then modified through a Monte-
Carlo simulation process, by which a (downward) risk adjustment is applied to the baseline expected
return. Best estimates of arithmetic real rates of return for each major asset class included in the pension
plan's target asset allocation as of June 30, 2017, and the final investment return assumption, are
summarized in the following table:
Long-term Money-
Target Expected Real Weighted Rate
Asset Class Allocation Rate of Return of Return
Domestic equity 27.00% 5.74% 1.54%
International equity - developed 12.00% 5.71% 0.69%
International equity - emerging 4.00% 6.80% 0.27%
Fixed income 25.00% 3.01% 0.75%
Real estate 10.00% 4.81% 0.48%
Global opportunistic fixed income 6.00% 4.12% 0.25%
Global equity long/short 10.00% 4.51% 0.45%
Absolute return 6.00% 4.23% 0.26%
100.00% 4.69%
Inflation 2.93%
Risk adjustments -0.22%
Investment rate of return 7.40%
Discount Rate. The discount rate used to measure the total pension liability was 7.37% (up from 7.09% in
2016). The projection of cash flows used to determine the discount rate assumed that plan member
contributions will be made at the current contribution rate and that City contributions will be made at rates
equal to the difference between actuarially determined contribution rates and the member rate. Based on
those assumptions, the pension plan's fiduciary net position was projected to be exhausted in the year
2069. Therefore, the discount rate represents the single equivalent rate resulting from discounting at the
long-term expected rate of return until 2069, and discounting with the 20-year AA municipal bond index
rate of 3.56% thereafter. This projection is done on a closed group basis, per GASB requirements. On an
ongoing, open-group basis, it is unlikely that the funds will be depleted because funding progress is
frequently reviewed and adjustments are made to contribution levels.
96
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Changes in the Net Pension Liability. The components of the change in the net pension liability are
summarized as follows:
Total Pension Plan Fiduciary Net Pension
Liability Net Position Liability
(a) (b) (a) - (b)
Balances at June 30, 2016 $ 324,725,530 $ 164,049,912 $ 160,675,618
Changes for the year:
Service cost 2,711,461 - 2,711,461
Interest 22,403,009 22,403,009
Differences between expected and
actual experience (23,183,264) (23,183,264)
Changes in assumptions 3,706,512 3,706,512
Employer contributions - 10,246,872 (10,246,872)
Employee contributions 1,216,519 (1,216,519)
Net investment income 17,412,568 (17,412,568)
Benefit payments, including refunds of
employee contributions (22,913,214) (22,913,214) -
Administrative expense (47,217) 47,217
Net changes (17,275,496) 5,915,528 (23,191,024)
Balances at June 30, 2017 $ 307,450,034 $ 169,965,440 $ 137,484,594
Sensitivity of the Net Pension Liability to Changes in the Discount Rate. The following presents the net
pension liability of the City, calculated using the discount rate of 7.37%, as well as what the City's net
pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower
(6.37%) or 1-percentage-point higher (8.37%) than the current rate:
One Percent Current One Percent
Decrease Discount Rate Increase
(6.37%) (7.37%) (8.37%)
Net pension liability $ 164,318,715 $ 137,484,594 $ 114,456,802
97
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to
Pensions. For the year ended June 30, 2017, the City recognized pension expense of $5,092,471. At June
30, 2017, the City reported deferred outflows of resources and deferred inflows of resources related to
pensions from the following sources:
Net Deferred
Deferred Deferred Outflows
Outflows of Inflows of (Inflows) of
Resources Resources Resources
Difference between expected and actual experience $ - $ 13,237,573 $ (13,237,573)
Changes in assumptions 4,378,515 - 4,378,515
Net difference between projected and actual earnings
on pension plan investments 8,866,675 - 8,866,675
Total $ 13,245,190 $ 13,237,573 $ 7,617
Amounts reported as deferred outflows of resources and deferred inflows of resources related to pension
will be recognized in pension expense as follows:
Year Ended
June 30, Amount
2018 $ (4,906,073)
2019 3,952,986
2020 2,082,049
2021 (1,121,345)
Total $ 7,617
Payable to the Pension Plan. At June 30, 2017, the City did not have any outstanding amount of
contributions to the pension plan required for the year ended June 30, 2017.
Police and Fire Retirement System
Plan Description. The City sponsors and administers the Police and Fire Retirement System (the "Plan"), a
single-employer, defined benefit pension plan that covers all police officers and fire fighters who are full-
time employees of the City. The Plan was established and may be amended by the City Council and is
administered by an eight member Board of Trustees. The Board is comprised of the Mayor of the City, one
member of the City Council appointed by the City Council, the City Treasurer, a resident of the City who
shall be appointed by the Mayor, by and with the consent of Council, two members each of the police and
fire departments, to be elected by all the members of their respective departments. It is accounted for as
a separate pension trust fund. Separate financial statements are not issued for the Plan.
98
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Members may retire at age 55, or at any age with 25 or more years of credited service. Members are vested
after completing 10 years of credited service. Members are required to retire at age 60 (Police) or 70
(Fire). When an employee who had retired subsequent to August 31, 1966, dies, the plan provides for an
automatic pension to the retiree's spouse. This automatic pension is equal to 50% of the regular retirement
benefit the employee had been receiving at time of death. Effective July 30, 1990, members may elect a
reduced benefit, either 93% or 86% of the regular benefit, thereby increasing the spouse pension to 75% or
86% of the regular benefit, respectively. Alternately, members may elect a non-spousal beneficiary option.
The plan provides death and disability benefits. If a member leaves employment or dies before vesting,
accumulated member contributions plus interest are refunded to the member or designated beneficiary.
Members who are vested and terminate their employment have the option of deferred retirement benefits
until age 55 or withdrawing their contribution, thereby forfeiting any future benefits.
Summary of Significant Accounting Policies. The financial statements of the Plan are prepared using the
accrual basis of accounting. Plan member contributions are recognized in the period which the contributions
are due. The City's contributions are recognized when due and a formal commitment to provide the
contribution has been made. Benefits and refunds are recognized when due and payable in accordance with
the terms of the Plan. Administration of the Plan is funded through the Plan's investment earnings.
Method Used to Value Investments. Plan investments are reported at fair value. Short-term investments are
reported at cost, which approximates fair value. Securities traded on a national or international exchange
are valued at the last reported sales price at current exchange rates. Investments for which market
quotations are not readily available are valued at their fair values as determined by the custodian under the
direction of the Plan Board of Trustees, with the assistance of a valuation service.
Plan Membership. At December 31, 2016, plan membership consisted of the following:
Retirees and beneficiaries currently receiving benefits 736
Terminated employees entitled to but not yet receiving benefits 39
Vested and non-vested active participants 361
Total membership 1,136
Benefits Provided. Annual retirement allowances are determined by multiplying final average compensation
by 3.2% for the first 25 years of credited service. The maximum allowance is 80% of final average
compensation. Final average compensation is the member's highest wages for 2 consecutive years.
Contributions. The contribution requirements of Plan members are established and may be amended by the
City Council in accordance with City policies, union contracts, and Plan provisions. Fire members are
required to contribute 10.0% of their annual wages to the plan. Police supervisors are required to
contribute 9.52% and police non-supervisors, 9.0%. Chapter 294 of the City of Lansing's Ordinance
establishes benefit provisions and requires that the portion of the annuity and pension reserves (which are
determined annually by the City's actuary) not financed by member contributions shall be financed by
annual appropriations. The City's contribution rate for the plan for the year ended June 30, 2017 was
41.8% of projected valuation payroll.
Investment Policy. The plan's policy in regard to the allocation of invested assets is established and may be
amended by the Board of Trustees. The investment policy has been formulated based on consideration of a
wide range of policies and describes the prudent investment process that the Board deems appropriate. The
Plan's asset allocation policy is shown on the following pages.
99
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Rate of Return. For the year ended June 30, 2017, the annual money-weighted rate of return on pension
plan investments, net of pension plan investment expense, was 12.06%. The money-weighted rate of return
expresses investment performance, net of investment expense, adjusted for the changing amounts actually
invested.
Concentrations. At June 30, 2017, the Plan held certain investments (other than those issued or explicitly
guaranteed by the U.S. government, mutual funds, external investment pools, or other pooled investments)
in certain organizations that represent 5% or more of the Plan's fiduciary net position. Please see Footnote
4 for the details of these concentrations.
Reserves. In accordance with the Plan policy, the City establishes reserves for various purposes. The
reserves are adjusted annually based on recommendations from the City's actuaries. The policy for creating
and adjusting reserves was established and can be amended by the Plan Board of Trustees. A summary of
the Plan reserves at June 30, 2017 is as follows:
Reserve/Group Balance
Retirement reserve fund $ 288,441,203
Health insurance fund 34,133,238
Net Pension Liability. The components of the net pension liability for the police and fire retirement system
at June 30, 2017, were as follows:
Total pension liability $ 429,670,098
Plan fiduciary net position 288,441,203
Net pension liability $ 141,228,895
Plan fiduciary net position as
percentage of total pension
liability 67.1
Actuarial Assumptions. The total pension liability was determined by an actuarial valuation as of December
31, 2016, rolled forward to June 30, 2017, using the following actuarial assumptions, applied to all periods
included in the measurement:
Inflation 2.85% (previous year: 3.10%)
Salary increases 2.85%, plus service based increases (previous year:
3.10%)
Investment rate of return 7.35%, net of investment expense and including
inflation (previous year: 7.60%)
Mortality is based on the RP-2000 tables (with Blue Collar adjustments for Police and Fire) for males and
females. For Disabled members, the disabled versions of these tables are used. Each of these tables is
projected to 2026 using Scale BB and a 50%factor is applied for pre-retirement deaths.
100
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
The actuarial assumptions used in the December 31, 2016 valuation were based on the results of actuarial
experience analysis conducted in December 2016. There was a change in the discount rate due to a higher
bond rate.
The long-term expected rate of return on pension plan investments was determined using a building-block
method in which best-estimates of expected future real rates of return (expected returns, net of pension
plan investment expense and inflation) are developed for each asset class. These ranges are combined to
produce the long-term expected rate of return by weighting the expected future real rates of return by the
target asset allocation percentage and by adding expected inflation. This is then modified through a Monte-
Carlo simulation process, by which a (downward) risk adjustment is applied to the baseline expected
return. Best estimates of arithmetic real rates of return for each major asset class included in the pension
plan's target asset allocation as of June 30, 2017, and the final investment return assumption, are
summarized in the following table:
Long-term Money-
Target Expected Real Weighted Rate
Asset Class Allocation Rate of Return of Return
Domestic equity 32.00% 5.74% 1.83%
International equity - developed 12.00% 5.71% 0.69%
International equity - emerging 4.00% 6.80% 0.27%
Fixed income 22.00% 3.01% 0.66%
Real estate 10.00% 4.81% 0.48%
Global opportunistic fixed income 5.00% 4.12% 0.21
Global equity long/short 10.00% 4.51% 0.45%
Absolute return 5.00% 4.23% 0.22%
100.00% 4.81%
Inflation 2.85%
Risk adjustments -0.31%
Investment rate of return 7.35%
Discount Rate. The discount rate used to measure the total pension liability was 7.29% (down from 7.49% in
2016). The projection of cash flows used to determine the discount rate assumed that plan member
contributions will be made at the current contribution rate and that City contributions will be made at rates
equal to the difference between actuarially determined contribution rates and the member rate. Based on
those assumptions, the pension plan's fiduciary net position was projected to be exhausted in the year
2072. Therefore, the discount rate represents the single equivalent rate resulting from discounting at the
long-term expected rate of return until 2072, and discounting with the 20-year AA municipal bond index
rate of 3.56% thereafter. This projection is done on a closed group basis, per GASB requirements. On an
ongoing, open-group basis, it is unlikely that the funds will be depleted because funding progress is
frequently reviewed and adjustments are made to contribution levels.
101
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Changes in the Net Pension Liability. The components of the change in the net pension liability are
summarized as follows:
Total Pension Plan Fiduciary Net Pension
Liability Net Position Liability
(a) (b) (a) - (b)
Balances at June 30, 2016 $ 418,348,450 $ 273,115,398 $ 145,233,052
Changes for the year:
Service cost 6,133,683 - 6,133,683
Interest 30,519,676 30,519,676
Differences between expected and
actual experience (19,308,117) (19,308,117)
Changes in assumptions 25,078,592 25,078,592
Employer contributions - 11,521,768 (11,521,768)
Employee contributions 2,840,914 (2,840,914)
Net investment income 32,116,305 (32,116,305)
Benefit payments, including refunds of
employee contributions (31,102,186) (31,102,186) -
Administrative expense - (50,996) 50,996
Net changes 11,321,648 15,325,805 (4,004,157)
Balances at June 30, 2017 $ 429,670,098 $ 288,441,203 $ 141,228,895
Sensitivity of the Net Pension Liability to Changes in the Discount Rate. The following presents the net
pension liability of the City, calculated using the discount rate of 7.29%, as well as what the City's net
pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower
(6.29%) or 1-percentage-point higher (8.29%) than the current rate:
One Percent Current One Percent
Decrease Discount Rate Increase
(6.29%) (7.29%) (8.29%)
Net pension liability $ 185,690,311 $ 141,228,895 $ 103,535,375
102
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to
Pensions. For the year ended June 30, 2017, the City recognized pension expense of $25,093,828. At June
30, 2017, the City reported deferred outflows of resources and deferred inflows of resources related to
pensions from the following sources:
Net Deferred
Deferred Deferred Outflows
Outflows of Inflows of (Inflows) of
Resources Resources Resources
Difference between expected and actual experience $ 4,732,082 $ 14,481,088 $ (9,749,006)
Changes in assumptions 20,449,615 - 20,449,615
Net difference between projected and actual earnings
on pension plan investments 12,125,583 - 12,125,583
Total $ 37,307,280 $ 14,481,088 $ 22,826,192
Amounts reported as deferred outflows of resources and deferred inflows of resources related to pension
will be recognized in pension expense as follows:
Year Ended
June 30, Amount
2018 $ 10,798,456
2019 10,008,458
2020 4,528,926
2021 (2,509,648)
Total $ 22,826,192
Payable to the Pension Plan. At June 30, 2017, the City did not have any outstanding amount of
contributions to the pension plan required for the year ended June 30, 2017.
103
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Financial statements for individual pension and employee benefit plans:
Pension and Other Postemployment Benefits Net Position
Employees' Employees' Police Police Employees'
Retirement Retirement and Fire and Fire Money Retiree
System System Retirement Retirement Purchase Health Care
Pension OPEB System System OPEB Pension Plan VEBA Totals
Assets
Cash and cash equivalents $ 8,036,907 $ $ 9,302,156 $ $ $ $ 17,339,063
Equity in pooled cash and
investments 725,786 1,661,698 2,387,484
Investments:
Money market funds 5,234,992 906,236 3,127,525 378,495 717,966 10,365,214
Government obligations 18,707,176 3,238,423 24,120,680 2,919,100 12,829 - 48,998,208
Corporate bonds 19,953,585 3,454,191 26,113,614 3,160,286 - 52,681,676
Common stocks 38,080,363 6,592,141 75,505,494 9,137,724 129,315,722
Emerging markets - - - - - 730,520 730,520
Mutualfunds 84,174,407 14,571,541 153,177,443 18,537,633 2,317,610 24,469,619 297,248,253
Contribution receivable 1,854 - 3,668 - 4,628 - 10,150
Dividends and interest receivable 173,932 - 219,004 - 89 393,025
Total assets 175,089,002 28,762,532 293,231,282 34,133,238 2,335,067 25,918,194 559,469,315
Liabilities
Accounts payable 5,123,562 - 4,790,079 - - - 9,913,641
Net position restricted for
Pension benefits 169,965,440 - 288,441,203 - 2,335,067 - 460,741,710
Other postem ployment benefits - 28,762,532 - 34,133,238 - 25,918,194 88,813,964
Total net position $ 169,965,440 $ 28,762,532 $ 288,441,203 $ 34,133,238 $ 2,335,067 $ 25,918,194 $ 549,555,674
104
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Changes in Pension and Other Postemployment Benefits Net Position
Employees' Employees' Police Police Employees'
Retirement Retirement and Fire and Fire Money Retiree
System System Retirement Retirement Purchase Health Care
Pension OPEB System System OPEB Pension Plan VEBA Totals
Additions
Investment income:
Net appreciation (depreciation)
in fair value of investments $ 16,701,649 $ 2,718,883 $ 31,060,205 $ 3,487,200 $ - $ (80,511) $ 53,887,426
Interest income 849,661 - 1,054,136 - 236,081 53 2,139,931
Dividend income 531,938 1,110,626 - 2,571,244 4,213,808
Investment expenses (670,680) (1,108,662) (5,486) - (1,784,828)
Net investment income 17,412,568 2,718,883 32,116,305 3,487,200 230,595 2,490,786 58,456,337
Contributions:
Employer 10,246,872 10,705,756 11,521,768 12,290,749 88,562 600,000 45,453,707
Plan members 1,216,519 - 2,840,914 - 72,698 - 4,130,131
Total contributions 11,463,391 10,705,756 14,362,682 12,290,749 161,260 600,000 49,583,838
Total additions 28,875,959 13,424,639 46,478,987 15,777,949 391,855 3,090,786 108,040,175
Deductions
Participant benefits 22,913,214 10,116,593 31,102,186 11,065,440 86,257 - 75,283,690
Administrative expense 47,217 389,163 50,996 525,309 - 1,012,685
Total deductions 22,960,431 10,505,756 31,153,182 11,590,749 86,257 76,296,375
Change in net position 5,915,528 2,918,883 15,325,805 4,187,200 305,598 3,090,786 31,743,800
Net position restricted
for pension and other
postemployment benefits:
Beginning of year 164,049,912 25,843,649 273,115,398 29,946,038 2,029,469 22,827,408 517,811,874
End of year $169,965,440 $ 28,762,532 $288,441,203 $ 34,133,238 $ 2,335,067 $ 25,918,194 $549,555,674
105
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
17. OTHER POSTEMPLOYMENT BENEFITS
Primary Government
Plan Description. The City of Lansing contributes to the Employees' Retirement System, the Police and
Fire Retirement System, and the Voluntary Employees Beneficiary Association amounts to pre-fund
postemployment healthcare. In the Employees' Retirement System and the Police and Fire Retirement
System, these other postemployment benefits (OPEB) are set up as reserves in the pension plans, and their
investments are commingled with the investments of the pension plan. Portfolio makeup is reported as a
percentage of total pension plan assets. Earnings are calculated based on a seven year smoothed rate of
return of the retirement systems. Eligible participants include any retirees who receive pension benefits
under their respective pension plans, with the exception of Teamster 580 employees hired after May 2014.
OPEB plan provisions are established and may be amended by the City Council, subject to the City's
various collective bargaining agreements. Separate financial statements are not prepared for the plans.
Method Used to Value Investments. Plan investments are reported at fair value. Securities traded on a
national or international exchange are valued at the last reported sales price at current exchange rates.
Investments for which market quotations are not readily available are valued at their fair values as
determined by the custodian under the direction of each plans' board of trustees, with the assistance of a
valuation service.
Voluntary Employees Beneficiary Association(VEBL)
The City of Lansing Voluntary Employees Beneficiary Association (the "Plan") is a single-employer defined
benefit postemployment healthcare plan established by the City to provide medical and healthcare
benefits for retirees and their beneficiaries. Eligible participants include any retirees who receive pension
benefits under one of the City's pension plans. The Plan is funded by a trust agreement established
pursuant to Section 501(c)(9) of the Internal Revenue Code that allows for the formation of a VEBA. During
the year, the City contributed $600,000 to the Plan.
Employees'Retirement System
Plan Description. The City provides postemployment health care benefits, in accordance with labor
agreements, to full-time employees of the City and employees of the 54-A District Court (not including
police officers and firefighters who are members of the Police and Fire Retirement System). Members
eligible for pension benefits under the Employees' Retirement System are also eligible to receive health
care benefits, with the exception of Teamster 580 employees hired after May, 2014. The Plan was
established and may be amended by the City Council and is administered by a nine member Board of
Trustees. The Board is comprised of the Mayor of the City, one member of the City Council appointed by
the City Council, the City Treasurer, the City Human Resources Director, three members of the retirement
system to be elected by the members of the system under rules adopted by the board, two residents of the
State of Michigan appointed by the Mayor, by and with the consent of the City Council, one of which is a
retiree of the retirement system.
106
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Membership of the Plan consisted of the following at January 1, 2016, the date of the most recent
actuarial valuation:
Retirees and beneficiaries receiving benefits 865
Terminated plan members entitled to but
not yet receiving benefits 52
Active plan members 374
Total 1,291
Benefits Provided. The City provides the full cost of health benefits to retirees, payable to health care
vendors, and also reimburses retirees eligible for Medicare benefits of $134.00 per month for each covered
retiree and eligible dependent(s) eligible for retiree healthcare. The payments are charged to the fringe
benefit internal service fund of the City and are recognized as expenses as payments are made.
Contributions. The contribution requirements of the Plan members and the City are established and may
be amended by the City Council, in accordance with City policies, union contracts, and Plan provisions.
Retirees and their beneficiaries are eligible for postemployment healthcare benefits if they qualify under
the various contracts. The required contribution is based on projected pay-as-you-go financing
requirements, with an additional amount to prefund benefits as determined through the bi-annual
actuarial valuation. For the year ended June 30, 2017, the City contributed $11,305,756 (direct benefit
payments of$10,505,756 and City contributions of$800,000) to the Plan.
Rate of Return. For the year ended June 30, 2017, the annual money-weighted rate of return on
investments, net of investment expense, was 9.90%. The money-weighted rate of return expresses
investment performance, net of investment expense, adjusted for the changing amounts actually invested.
Net OPEB Liability of the City. The components of the net OPEB liability of the City at June 30, 2017,
were as follows:
Total OPEB liability $ 231,583,031
Plan fiduciary net position 54,680,726
City's net OPEB liability $ 176,902,305
Plan fiduciary net position as
percentage of total OPEB
liability 23.61
107
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Actuarial Assumptions. The total OPEB liability was determined by an actuarial valuation as of January 1,
2016, rolled forward to June 30, 2017, using the following actuarial assumptions, applied to all periods
included in the measurement:
Inflation 2.85%
Investment rate of return 7.40%, net of OPEB plan investment expense,
including inflation
Retirement age Age-based table of rates that are specific to the
type of eligibility condition
Healthcare cost trend rate
Year Beginning Connecticut
July 1, Pre-Medicare Medicare Partnership
2017 6.50% 4.50% 4.00%
2018 6.00% 4.50% 5.50%
2019 5.50% 4.50% 5.00%
2020 5.00% 4.25% 4.75%
2021 4.50% 4.00% 4.50%
2022+ 4.50% 4.00% 4.50%
Mortality rates are assumed to be in accordance with the Retired Pensioners (RP) 2000 Combined Healthy
tables, with Blue Collar adjustments projected Scale BB, to account for anticipated future improvements
in life expectancy. Adjustments to these rates are as follows:
Pre-retirement: 50% of base rates.
Post-disablement: RP2000 disabled tables with Scale BB
The actuarial assumptions used in the January 1, 2016 valuation were based on the results of an actuarial
experience study conducted in 2016.
Investment Policy. The Plan's policy in regard to the allocation of invested assets is established and may
be amended by the Board of Trustees. The investment policy has been formulated based on consideration
of a wide range of policies and describes the prudent investment process that the Board deems
appropriate. The Plan's asset allocation policy as of June 30, 2017 is summarized in the table on the
following page.
108
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
The long-term expected rate of return on OPEB plan investments was determined using a building-block
method in which best-estimates of expected future real rates of return (expected returns, net of OPEB
plan investment expense and inflation) are developed for each asset class. These ranges are combined to
produce the long-term expected rate of return by weighting the expected future real rates of return by
the target asset allocation percentage and by adding expected inflation. This is then modified through a
Monte-Carlo simulation process, by which a (downward) risk adjustment is applied to the baseline
expected return. Best estimates of arithmetic real rates of return for each major asset class included in
the OPEB plan's target asset allocation as of June 30, 2017 are summarized in the following table:
Long-term Money-
Target Expected Real Weighted Rate
Asset Class Allocation Rate of Return of Return
Domestic equity 27.00% 5.74% 1.55%
International equity - developed 12.00% 5.71% 0.69%
International equity - emerging 4.00% 6.80% 0.27%
Fixed income - U.S. 25.00% 3.01% 0.75%
Real assets 10.00% 4.81% 0.48%
Global opportunistic fixed income 6.00% 4.12% 0.25%
Global equity long/short 10.00% 4.51% 0.45%
Absolute return 6.00% 4.23% 0.25%
100.00% 4.69%
Inflation 2.93%
Risk adjustment -0.22%
Investment rate of return 7.40%
Discount Rate. The discount rate used to measure the total OPEB liability was 5.80%. The projection of
cash flows used to determine the discount rate assumed that plan member contributions will be made at
the current contribution rate and that City contributions will be made at rates equal to the difference
between actuarially determined contribution rates and the member rate. Based on those assumptions, the
OPEB plan's fiduciary net position was projected to be exhausted in the year 2033. Therefore, the discount
rate represents the single equivalent rate resulting from discounting at the long-term expected rate of
return until 2033, and discounting with the 20-year AA municipal bond index rate of 3.56% thereafter. This
projection is done on a closed group basis, per GASB requirements. On an ongoing, open-group basis, it is
unlikely that the funds will be depleted because funding progress is frequently reviewed and adjustments
are made to contribution levels.
109
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Changes in the Net OPEB Liability. The components of the change in the net OPEB liability are summarized
as follows:
Total OPEB Plan Fiduciary Net OPEB
Liability Net Position Liability
(a) (b) (a) - (b)
Balances at June 30, 2016 $ 227,172,513 $ 48,671,057 $ 178,501,456
Changes for the year:
Service cost 1550,428 - 1,550,428
Interest on total OPEB liability 12,976,683 - 12,976,683
Employer contributions - 11,305,756 (11,305,756)
Net investment income 5,209,669 (5,209,669)
Benefit payments (10,116,593) (10,116,593) -
Administrative expense - (389,163) 389,163
Net changes 4,410,518 6,009,669 (1,599,151)
Balances at June 30, 2017 $ 231,583,031 $ 54,680,726 $ 176,902,305
Sensitivity of the Net OPEB Liability to Changes in the Discount Rate. The following presents the net OPEB
liability of the City, calculated using the discount rate of 5.80%, as well as what the City's net OPEB
liability would be if it were calculated using a discount rate that is 1% lower (4.80%) or 1% higher (6.80%)
than the current rate:
Current
1% Decrease Discount Rate 1% Increase
(4.80%) (5.80%) (6.80%)
City's net OPEB liability $ 209,785,033 $ 176,902,305 $ 150,218,082
Sensitivity of the Net OPEB Liability to Changes in the Healthcare Cost Trend Rate Assumption. The
following presents the net OPEB liability of the City, as well as what the City's net OPEB liability would be
if it were calculated using healthcare cost trend rates that are 1% lower (3.50%) or 1% higher (5.50%) than
the current healthcare cost trend rates:
Healthcare
Ultimate Cost
1% Decrease Trend Rates 1% Increase
(3.50%) (4.50%) (5.50%)
City's net OPEB liability $ 149,169,460 $ 176,902,305 $ 214,799,324
110
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Pension Plan Fiduciary Net Position. Detailed information about the OPEB plan's fiduciary net position is
available in the combining statements for the pension and other postemployment benefit trust funds
preceding this footnote.
Payable to the OPEB Plan. At June 30, 2017, the City reported had no amount payable to the OPEB plan.
Annual OPEB Cost and Net OPEB Obligation. The City's annual other postemployment benefit (OPEB) cost
is calculated based on the annual required contribution of the employer (ARC), an amount actuarially
determined in accordance with the parameters of GASB Statement 45. The following table shows the
components of the City's annual OPEB cost for the year, the amount actually contributed to the Plan, and
changes in the City's net OPEB obligation:
Annual required contribution $ 12,223,228
Interest on net OPEB obligation 990,722
Adjustment to annual required contribution (877,065)
Net OPEB cost 12,336,885
Contributions made (11,305,756)
Change in net OPEB obligation 1,031,129
Net OPEB obligation, beginning of year 13,665,127
Net OPEB obligation, end of year $ 14,696,256
The City's annual OPEB cost, the percentage of annual OPEB cost contributed to the Plan, and the net
OPEB obligation for the current year and the two preceding years were as follows:
Three-Year Trend Information
Percentage
of Annual
Year Ended Annual OPEB OPEB Cost Net OPEB
June 30, Cost Contributed Obligation
2015 $ 13,270,701 69.4% $ 11,032,264
2016 11,447,334 77.0% 13,665,127
2017 12,336,885 91.6% 14,696,256
111
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Police and Fire Retirement *stem
Plan Description. The City also provides postemployment health care benefits, in accordance with labor
agreements, to members who are eligible to receive pension benefits under the Police and Fire Retirement
System. The Plan was established and may be amended by the City Council and is administered by an eight
member Board of Trustees. The Board is comprised of the Mayor of the City, one member of the City
Council appointed by the City Council, the City Treasurer, a resident of the City who shall be appointed by
the Mayor, by and with the consent of Council, two members each of the police and fire departments, to
be elected by all the members of their respective departments.
Membership of the Plan consisted of the following at January 1, 2016, the date of the most recent
actuarial valuation:
Retirees and beneficiaries receiving benefits 663
Terminated plan members entitled to but
not yet receiving benefits 23
Active plan members 346
Total 1,032
Benefits Provided. The City provides the full cost of health benefits to retirees, payable to health care
vendors, and also reimburses retirees eligible for Medicare benefits of $134.00 per month for each covered
retiree and dependent(s). The payments are charged to the fringe benefit internal service fund of the City
and are recognized as expenses as payments are made.
Contributions. The contribution requirements of the Plan members and the City are established and may
be amended by the City Council, in accordance with City policies, union contracts, and Plan provisions.
Retirees and their beneficiaries are eligible for postemployment healthcare benefits if they qualify under
the various contracts. The required contribution is based on projected pay-as-you-go financing
requirements, with an additional amount to prefund benefits as determined through the bi-annual
actuarial valuation. For the year ended June 30, 2017, the City contributed $12,290,749 (direct benefit
payments of$11,590,749 and City contributions of$700,000) to the Plan.
Rate of Return. For the year ended June 30, 2017, the annual money-weighted rate of return on
investments, net of investment expense, was 9.89%. The money-weighted rate of return expresses
investment performance, net of investment expense, adjusted for the changing amounts actually invested.
Net OPEB Liability of the City. The components of the net OPEB liability of the City at June 30, 2017,
were as follows:
Total OPEB liability $ 294,892,197
Plan fiduciary net position 34,133,238
City's net OPEB liability $ 260,758,959
Plan fiduciary net position as
percentage of total OPEB
liability 11.57%
112
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Actuarial Assumptions. The total OPEB liability was determined by an actuarial valuation as of January 1,
2016, rolled forward to June 30, 2017, using the following actuarial assumptions, applied to all periods
included in the measurement:
Inflation 2.85%
Investment rate of return 7.35%, net of OPEB plan investment expense,
including inflation
Retirement age Age-based table of rates that are specific to the
type of eligibility condition
Healthcare cost trend rate
Year Beginning Connecticut
July 1, Pre-Medicare Medicare Partnership
2017 6.50% 4.50% 4.00%
2018 6.00% 4.50% 5.50%
2019 5.50% 4.50% 5.00%
2020 5.00% 4.25% 4.75%
2021 4.50% 4.00% 4.50%
2022+ 4.50% 4.00% 4.50%
Mortality rates are assumed to be in accordance with the Retired Pensioners (RP) 2000 Combined Healthy
tables, with Blue Collar adjustments projected Scale BB, to account for anticipated future improvements
in life expectancy. Adjustments to these rates are as follows:
Pre-retirement: 50% of base rates.
Post-disablement: RP2000 disabled tables with Scale BB
The actuarial assumptions used in the January 1, 2016 valuation were based on the results of an actuarial
experience study conducted in 2016.
Investment Policy. The Plan's policy in regard to the allocation of invested assets is established and may
be amended by the Board of Trustees. The investment policy has been formulated based on consideration
of a wide range of policies and describes the prudent investment process that the Board deems
appropriate. The Plan's asset allocation policy as of June 30, 2017 is summarized in the table below.
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CITY OF LANSING, MICHIGAN
Notes to Financial Statements
The long-term expected rate of return on OPEB plan investments was determined using a building-block
method in which best-estimates of expected future real rates of return (expected returns, net of OPEB
plan investment expense and inflation) are developed for each asset class. These ranges are combined to
produce the long-term expected rate of return by weighting the expected future real rates of return by
the target asset allocation percentage and by adding expected inflation. This is then modified through a
Monte-Carlo simulation process, by which a (downward) risk adjustment is applied to the baseline
expected return. Best estimates of arithmetic real rates of return for each major asset class included in
the OPEB plan's target asset allocation as of June 30, 2017 are summarized in the following table:
Long-term Money-
Target Expected Real Weighted Rate
Asset Class Allocation Rate of Return of Return
Domestic equity 32.00% 5.74% 1.84%
International equity - developed 12.00% 5.71% 0.69%
International equity - emerging 4.00% 6.80% 0.27%
Fixed income - U.S. 22.00% 3.01% 0.66%
Real assets 10.00% 4.81% 0.48%
Global opportunistic fixed income 5.00% 4.12% 0.21%
Global equity long/short 10.00% 4.51% 0.45%
Absolute return 5.00% 4.23% 0.21%
100.00% 4.81%
Inflation 2.85%
Risk adjustment -0.31%
Investment rate of return 7.35%
Discount Rate. The discount rate used to measure the total OPEB liability was 5.47%. The projection of
cash flows used to determine the discount rate assumed that plan member contributions will be made at
the current contribution rate and that City contributions will be made at rates equal to the difference
between actuarially determined contribution rates and the member rate. Based on those assumptions, the
OPEB plan's fiduciary net position was projected to be exhausted in the year 2037. Therefore, the discount
rate represents the single equivalent rate resulting from discounting at the long-term expected rate of
return until 2037, and discounting with the 20-year AA municipal bond index rate of 3.56% thereafter. This
projection is done on a closed group basis, per GASB requirements. On an ongoing, open-group basis, it is
unlikely that the funds will be depleted because funding progress is frequently reviewed and adjustments
are made to contribution levels.
114
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Changes in the Net OPEB Liability. The components of the change in the net OPEB liability are summarized
as follows:
Total OPEB Plan Fiduciary Net OPEB
Liability Net Position Liability
(a) (b) (a) - (b)
Balances at June 30, 2016 $ 286,623,495 $ 29,946,038 $ 256,677,457
Changes for the year:
Service cost 3,749,359 - 3,749,359
Interest on total OPEB liability 15,584,783 - 15,584,783
Employer contributions - 12,290,749 (12,290,749)
Net investment income 3,487,200 (3,487,200)
Benefit payments (11,065,440) (11,065,440) -
Administrative expense - (525,309) 525,309
Net changes 8,268,702 4,187,200 4,081,502
Balances at June 30, 2017 $ 294,892,197 $ 34,133,238 $ 260,758,959
Sensitivity of the Net OPEB Liability to Changes in the Discount Rate. The following presents the net OPEB
liability of the City, calculated using the discount rate of 5.47%, as well as what the City's net OPEB
liability would be if it were calculated using a discount rate that is 1% lower (4.47%) or 1% higher (6.47%)
than the current rate:
Current
1% Decrease Discount Rate 1% Increase
(4.47%) (5.47%) (6.47%)
City's net OPEB liability $ 306,319,897 $ 260,758,959 $ 224,421,858
Sensitivity of the Net OPEB Liability to Changes in the Healthcare Cost Trend Rate Assumption. The
following presents the net OPEB liability of the City, as well as what the City's net OPEB liability would be
if it were calculated using healthcare cost trend rates that are 1% lower (3.50%) or 1% higher (5.50%) than
the current healthcare cost trend rates:
Healthcare
Ultimate Cost
1% Decrease Trend Rates 1% Increase
(3.50%) (4.50%) (5.50%)
City's net OPEB liability $ 223,117,088 $ 260,758,959 $ 313,764,856
Pension Plan Fiduciary Net Position. Detailed information about the OPEB plan's fiduciary net position is
available in the combining statements for the pension and other postemployment benefit trust funds
preceding this footnote.
115
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
Payable to the OPEB Plan. At June 30, 2017, the City reported had no amount payable to the OPEB plan.
Annual OPEB Cost and Net OPEB Obligation. The City's annual other postemployment benefit (OPEB) cost
is calculated based on the annual required contribution of the employer (ARC), an amount actuarially
determined in accordance with the parameters of GASB Statement 45. The following table shows the
components of the City's annual OPEB cost for the year, the amount actually contributed to the Plan, and
changes in the City's net OPEB obligation:
Annual required contribution $ 15,641,670
Interest on net OPEB obligation 3,505,357
Adjustment to annual required contribution (3,220,361)
Net OPEB cost (expense) 15,926,666
Contributions made (12,290,749)
Increase in net OPEB obligation 3,635,917
Net OPEB obligation, beginning of year 48,349,757
Net OPEB obligation, end of year $ 51,985,674
The City's annual OPEB cost, the percentage of annual OPEB cost contributed to the Plan, and the net
OPEB obligation for the current year and the two preceding years were as follows:
Three-Year Trend Information
Percentage
of Annual
Year Ended Annual OPEB OPEB Cost Net OPEB
June 30, Cost Contributed Obligation
2015 $ 17,923,366 64.5% $ 45,951,872
2016 15,276,901 84.3% 48,349,757
2017 15,926,666 77.2% 51,985,674
18. OPERATING LEASES
During fiscal year 2014, the City entered into an operating lease with the Lansing School District (the
"District"), for approximately 86,900 square feet of the Hill Center for Academics and Technology for the
purpose of operating a police precinct. The term of the lease runs through June 30, 2018. The City is
required to make approximately $800,000 worth of improvements to the leased space, the cost of which
will be capitalized by the District. In addition, beginning July 1, 2016, rent payments are made to the
District by the City in monthly installments of $2,083 ($25,000 annually) and $10,417 ($125,000 annually)
for the year ended June 30, 2018, respectively.
116
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
The Tax Increment Finance Authority (TIFA) component unit has entered into an operating lease with the
City of Lansing and County of Ingham Joint Building Authority (the "Joint Authority") related to the City's
use of a building constructed by the Joint Authority. The payments related to this lease are paid by the
TIFA, pursuant to a payment agreement between the City and the TIFA. The total of such payments
amounted to $572,644 for the year ended June 30, 2017. Future minimum lease payments for this lease
are as follows:
Year Ending
June 30, Amount
2018 $ 570,913
2019 573,367
2020 571,900
19. TAX ABATEMENTS
Because Lansing is an older city, vacant land, or "green space" for new buildings is scarce, the City offers
tax abatements to make redevelopment and rehabilitation of existing buildings economically viable for
developers, who must consider the cost of rehabilitating existing, often older, buildings which may involve
environmental remediation, against the generally lesser cost of building on vacant land outside the City.
These tax abatements are designed to level the "playing field" for urban communities to encourage
redevelopment of vacant buildings, and to attract and retain private investment and jobs within the City.
The City of Lansing provides tax abatements under several different programs:
Industrial property tax abatements are granted in the State of Michigan under Public Act 198 to
promote economic development, creation of jobs, and new or improved facilities. The Industrial
Facilities Tax (IFT) Exemption must be approved by both the City (after a public hearing is held) and
the State of Michigan. IFT exemptions can cover real and/or personal property. By State law, the
exemption must be applied for no later than six months after commencement of the project and must
be accompanied by a written agreement between the taxpayer and the local unit. An exemption allows
for taxation on IFT property at 50% of the local property tax millage rate for up to 12 years. A
certificate may be revoked and taxes recaptured for noncompliance with the terms of the agreement.
Property taxes abated by the City under this program for fiscal year 2017 amounted to $624,938.
The State of Michigan allows for Commercial Rehabilitation Exemption under Public Act 210 if making
substantial improvements to a business or multi-family residential facility. The City had no Commercial
Rehabilitation Exemptions for fiscal year 2017.
To incentivize new or expanded businesses, Public Act 328 allows for Personal Property Tax Exemptions
for qualified businesses located within eligible distressed communities. The exemption must be
approved by the City Commission and the State Treasurer. Once approved, the taxpayer is exempt from
personal property tax on new investments after the date of the exemption. The City can recapture the
taxes if the business defaults on the terms of the written agreement. Property taxes abated by the City
under this program for fiscal year 2017 amounted to $3,732,841.
117
CITY OF LANSING, MICHIGAN
Notes to Financial Statements
The Brownfield Redevelopment Authority encourages environmental cleanup and economic
development through its Brownfield Redevelopment Plan under Public Act 318. A developer performs
redevelopment and cleanup activities at a site that is obsolete or blighted. The increased tax revenues
resulting from the increase in taxable value are captured by the City and used to repay the developer
for qualifying expenses. There is no provision for recovery of abated taxes because the developer is
only paid for eligible expenses on a reimbursement-basis. Property taxes abated by the Authority under
this program for fiscal year 2017, through direct reimbursement to developers from current tax
captures, amounted to $202,101. In addition, there are reserve liabilities reported in the financial
statements that represent tax captures set aside for future developer reimbursements. Property taxes
abated by the Authority under this program for fiscal year 2017 amounted to $133,024.
■ ■ ■ ■ ■
118
REQUIRED SUPPLEMENTARY INFORMATION
119
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Employees' Retirement System
Schedules of Changes in Net Pension Liability and Related Ratios
Fiscal Year Ending June 30,
2017 2016 2015 2014
Total pension liability
Service cost $ 2,711,461 $ 2,977,084 $ 2,857,948 $ 2,982,624
Interest on total pension liability 22,403,009 22,268,516 22,671,909 22,722,630
Difference between expected and actual experience (23,183,264) (4,937,823) (6,422,330) -
Assumption changes 3,706,512 7,575,775
Benefit payments, including refunds (22,913,214) (22,860,449) (22,462,587) (22,790,522)
Net change in total pension liability (17,275,496) 5,023,103 (3,355,060) 2,914,732
Total pension liability, beginning of year 324,725,530 319,702,427 323,057,487 320,142,755
Total pension liability, end of year 307,450,034 324,725,530 319,702,427 323,057,487
Plan fiduciary net position
Employer contributions 10,246,872 10,181,620 10,547,556 9,361,009
Employee contributions 1,216,519 1,088,943 1,128,120 1,290,678
Pension plan net investment income (loss) 17,412,568 (2,790,190) 4,399,543 17,887,635
Benefit payments (including refunds) (22,913,214) (22,860,449) (22,462,587) (22,957,379)
Pension plan administrative expense (47,217) (126,486) (174,818) (741,037)
Net change in plan fiduciary net position 5,915,528 (14,506,562) (6,562,186) 4,840,906
Plan fiduciary net position, beginning of year 164,049,912 178,556,474 185,118,660 180,277,754
Plan fiduciary net position, end of year 169,965,440 164,049,912 178,556,474 185,118,660
Net pension liability $137,484,594 $ 160,675,618 $ 141,145,953 $ 137,938,827
Plan fiduciary net position as a percentage
of total pension liability 55.3% 50.5% 55.9% 57.3%
Covered payroll $ 20,901,389 $ 23,085,894 $ 19,769,460 $ 20,874,143
Net pension liability as a percentage
of covered payroll 657.8% 696.0% 714.0% 660.8%
Note: GASB 67 was implemented in fiscal year 2014. This schedule is being built prospectively. Ultimately, 10 years of data
will be presented.
120
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Employees' Retirement System
Schedule of the Net Pension Liability
Plan Net Net Pension
Position as Liability as
Fiscal Year Percentage of Percentage of
Ending Total Pension Plan Net Net Pension Total Pension Covered Covered
June 30, Liability Position Liability Liability Payroll Payroll
2014 $ 323,057,487 $ 185,118,660 $ 137,938,827 57.3% $ 20,874,143 660.8%
2015 319,702,427 178,556,474 141,145,953 55.9% 19,769,460 714.0%
2016 324,725,530 164,049,912 160,675,618 50.5% 23,085,894 696.0%
2017 307,450,034 169,965,440 137,484,594 55.3% 20,901,389 657.8%
Note: GASB 67 was implemented in fiscal year 2014. This schedule is being built prospectively. Ultimately, 10 years of data
will be presented.
121
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Employees' Retirement System
Schedule of Contributions
Actual
Contribution as
Fiscal Year Actuarially Contribution Percentage of
Ending Determined Actual Deficiency Covered Covered
June 30, Contribution* Contribution (Excess)* Payroll Payroll
2008 $ 6,022,000 $ 6,022,000 $ - $ 29,688,000 20.3%
2009 6,048,000 6,477,000 (429,000) 30,602,000 21.2%
2010 6,472,349 6,043,861 428,488 27,766,628 21.8%
2011 7,297,083 7,297,083 - 26,068,735 28.0%
2012 7,596,879 7,523,534 73,345 22,838,598 32.9%
2013 8,586,536 8,586,536 - 20,874,143 41.1%
2014 9,361,009 9,361,009 21,521,242 43.5%
2015 10,547,556 10,547,556 19,769,460 53.4%
2016 10,181,620 10,181,620 23,085,894 44.1%
2017 10,246,872 10,246,872 20,901,389 49.0%
* The City contributed in excess of its FY 2009 Actuarially Determined Contribution (ADC). The City's FY 2010 contribution
was reduced by the dollar amount of the FY 2009 overpayment. The FY 2012 City contribution was reduced by $73,345 in
recognition of additional contributions by United Auto Workers (UAW) employees, which were negotiated and contributed
after the establishment of the June 30, 2012 ADC from the December 31, 2010 valuation.
The actuarially determined contribution was based on projected covered payroll. Employer contributions were made in full
based on actual covered payroll. Accordingly, the actuarially determined contribution has been expressed above as a
percentage of actual payroll.
Notes to Schedule of Contributions
Valuation Date December 31, 2016 (rolled forward to June 30, 2017)
Notes Actuarially determined contribution rates are calculated as of the June 30 that is 12
months prior to the beginning of the fiscal year in which contributions are reported.
Methods and assumptions used to determine contribution rates:
Actuarial cost method Entry-age normal
Amortization method Level percent of payroll, closed
Remaining amortization
period 25 years
Asset valuation method Closed; 5-year smooth market
Inflation 2.925% (previous year: 3.10%)
Salary increases 2.925%plus service based increases (previous year: 3.10%)
Investment rate of return 7.40%, net of investment expense and including inflation (previous year: 7.60%)
Retirement age Age-based table of rates that are specific to the type of eligibility condition. Last
updated for the December 31, 2016 valuation. This was based on an actuarial
experience analysis conducted in 2016.
Mortality Mortality is based on the RP-2000 tables for males and females. For Disabled members,
the disabled versions of these tables are used. Each of these tables is projected to 2026
using Scale BB and a 50%factor is applied for pre-retirement deaths.
122
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Employees' Retirement System
Schedule of Investment Returns
Fiscal Year
Ending Annual
June 30, ReturA'l
2014 13.67%
2015 2.43%
2016 -1.60%
2017 10.91%
Annual money-weighted rate of return, net of investment expenses
Note: GASB 67 was implemented in fiscal year 2014. This schedule is being built prospectively. Ultimately, 10 years of data
will be presented.
123
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Police and Fire Retirement System
Schedules of Changes in Net Pension Liability and Related Ratios
Fiscal Year Ending June 30,
2017 2016 2015 2014
Total pension liability
Service cost $ 6,133,683 $ 6,371,845 $ 6,350,378 $ 6,614,784
Interest on total pension liability 30,519,676 30,197,513 29,159,382 27,896,927
Difference between expected and actual experience (19,308,117) 7,884,167 3,159,996 -
Assumption changes 25,078,592 3,281,341 -
Benefit payments, including refunds (31,102,186) (29,503,964) (27,969,021) (26,270,724)
Net change in total pension liability 11,321,648 18,230,902 10,700,735 8,240,987
Total pension liability, beginning of year 418,348,450 400,117,548 389,416,813 381,175,826
Total pension liability, end of year 429,670,098 418,348,450 400,117,548 389,416,813
Plan fiduciary net position
Employer contributions 11,521,768 10,884,312 11,050,091 11,248,857
Employee contributions 2,840,914 2,608,214 2,950,832 2,911,896
Pension plan net investment income (loss) 32,116,305 (6,040,910) 8,965,080 34,016,621
Benefit payments (including refunds) (31,102,186) (29,503,964) (27,969,021) (26,852,038)
Pension plan administrative expense (50,996) (128,903) (173,849) (1,141,506)
Net change in plan fiduciary net position 15,325,805 (22,181,251) (5,176,867) 20,183,830
Plan fiduciary net position, beginning of year 273,115,398 295,296,649 300,473,516 280,289,686
Plan fiduciary net position, end of year 288,441,203 273,115,398 295,296,649 300,473,516
Net pension liability $ 141,228,895 $ 145,233,052 $ 104,820,899 $ 88,943,297
Plan fiduciary net position as a percentage
of total pension liability 67.1% 65.3% 73.8% 77.2%
Covered payroll $ 27,585,521 $ 27,078,405 $ 24,407,740 $ 25,611,974
Net pension liability as a percentage
of covered payroll 512.0% 536.3% 429.5% 347.3%
Note: GASB 67 was implemented in fiscal year 2014. This schedule is being built prospectively. Ultimately, 10 years of data
will be presented.
124
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Police and Fire Retirement System
Schedule of the Net Pension Liability
Plan Net Net Pension
Position as Liability as
Fiscal Year Percentage of Percentage of
Ending Total Pension Plan Net Net Pension Total Pension Covered Covered
June 30, Liability Position Liability Liability Payroll Payroll
2014 $ 389,416,813 $ 300,473,516 $ 88,943,297 77.2% $ 25,611,974 347.3%
2015 400,117,548 295,296,649 104,820,899 73.8% 24,407,740 429.5%
2016 418,348,450 273,115,398 145,233,052 65.3% 27,078,405 536.3%
2017 429,670,098 288,441,203 141,228,895 67.1% 27,585,521 512.0%
Note: GASB 67 was implemented in fiscal year 2014. This schedule is being built prospectively. Ultimately, 10 years of data
will be presented.
125
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Police and Fire Retirement System
Schedule of Contributions
Actual
Contribution as
Fiscal Year Actuarially Contribution Percentage of
Ending Determined Actual Deficiency Covered Covered
June 30, Contribution* Contribution (Excess)* Payroll Payroll
2008 $ 6,520,974 $ 6,520,974 $ - $ 30,161,000 21.6%
2009 6,094,397 6,483,000 388,603 30,443,000 21.3%
2010 7,179,360 6,790,757 (388,603) 28,536,056 23.8%
2011 8,240,688 8,240,688 - 25,128,835 32.8%
2012 9,242,173 9,057,080 (185,093) 26,121,411 34.7%
2013 10,133,599 10,133,599 25,636,626 39.5%
2014 11,248,857 11,248,857 26,405,725 42.6%
2015 11,050,091 11,050,091 24,407,740 45.3%
2016 10,884,312 10,884,312 27,078,405 40.2%
2017 11,521,768 11,521,768 27,585,521 41.8%
* The City contributed in excess of its FY 2009 Actuarially Determined Contribution (ADC). The City's FY 2010 contribution
was reduced by the dollar amount of the FY 2009 overpayment. The FY 2012 City contribution was reduced by $185,093 in
recognition of additional contributions by International Association of Firefighters (IAFF) employees, which were
negotiated and contributed after the establishment of the June 30, 2012 ADC from the December 31, 2010 valuation.
The actuarially determined contribution was based on projected covered payroll. Employer contributions were made in full
based on actual covered payroll. Accordingly, the actuarially-determined contribution has been expressed above as a
percentage of actual payroll.
Notes to Schedule of Contributions
Valuation Date December 31, 2016 (rolled forward to June 30, 2017)
Notes Actuarially determined contribution rates are calculated as of the June 30 that is 12
months prior to the beginning of the fiscal year in which contributions are reported.
Methods and assumptions used to determine contribution rates:
Actuarial cost method Entry-age normal
Amortization method Level percent of payroll, closed
Remaining amortization
period 25 years
Asset valuation method Closed; 5-year smooth market
Inflation 2.85% (previous year: 3.10%)
Salary increases 2.85%plus service based increases (previous year: 3.10%)
Investment rate of return 7.35%, net of investment expense and including inflation (previous year: 7.60%)
Retirement age Age-based table of rates that are specific to the type of eligibility condition. Last
updated for the December 31, 2016 valuation. This was based on an actuarial
experience analysis conducted in 2016.
Mortality Mortality is based on the RP-2000 tables (with Blue Collar adjustments for Police and
Fire) for males and females. For Disabled members, the disabled versions of these
tables are used. Each of these tables is projected to 2026 using Scale BB and a 50%
factor is applied for pre-retirement deaths.
126
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Police and Fire Retirement System
Schedule of Investment Returns
Fiscal Year
Ending Annual
June 30, Returni'l
2014 17.28%
2015 3.04%
2016 -2.09%
2017 12.06%
Annual money-weighted rate of return, net of investment expenses
Note: GASB 67 was implemented in fiscal year 2014. This schedule is being built prospectively. Ultimately, 10 years of data
will be presented.
127
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Other Postemployment Benefits Plan
Employees' Retirement System
Schedule of Changes in Net OPEB Liability and Related Ratios
Fiscal Year
Ended
June 30, 2017
Total OPEB liability
Service cost $ 1,550,428
Interest on total OPEB liability 12,976,683
Benefit payments (10,116,593)
Net change in total OPEB liability 4,410,518
Total OPEB liability, beginning of year 227,172,513
Total OPEB liability, end of year 231,583,031
Plan fiduciary net position
Employer contributions 11,305,756
OPEB plan net investment income 5,209,669
Benefit payments (10,116,593)
Administrative expense (389,163)
Net change in plan fiduciary net position 6,009,669
Plan fiduciary net position, beginning of year 48,671,057
Plan fiduciary net position, end of year 54,680,726
Net OPEB liability $ 176,902,305
Plan fiduciary net position as a percentage
of total OPEB liability 23.61%
Covered payroll $ 20,901,389
Net OPEB liability as a percentage
of covered payroll 846.37%
Note: GASB 74 was implemented in fiscal year 2017. This schedule is being built prospectively. Ultimately, 10 years of data
will be presented.
128
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Other Postemployment Benefits Plan
Employees' Retirement System
Schedule of the Net OPEB Liability
Plan Net Net OPEB
Position as Liability as
Fiscal Year Percentage of Percentage of
Ending Total OPEB Plan Net Net OPEB Total OPEB Covered Covered
June 30, Liability Position Liability Liability Payroll Payroll
2017 $ 231,583,031 $ 54,680,726 $ 176,902,305 23.61% $ 20,901,389 846.37%
Note: GASB 74 was implemented in fiscal year 2017. This schedule is being built prospectively. Ultimately, 10 years of data
will be presented.
129
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Other Postemployment Benefits Plan
Employees' Retirement System
Schedule of Contributions
Actual
Contribution as
Fiscal Year Actuarially Contribution Percentage of
Ending Determined Actual Deficiency Covered Covered
June 30, Contribution Contribution (Excess) Payroll Payroll
2008 $ 9,026,892 $ 10,279,044 $ (1,252,152) $ 29,688,000 34.62%
2009 9,021,963 10,855,711 (1,833,748) 30,602,000 35.47%
2010 10,608,281 9,782,538 825,743 27,766,628 35.23%
2011 8,819,018 9,773,601 (954,583) 26,068,735 37.49%
2012 14,915,958 10,363,847 4,552,111 22,838,598 45.38%
2013 12,775,667 10,147,780 2,627,887 20,874,143 48.61%
2014 14,057,619 11,048,992 3,008,627 21,521,242 51.34%
2015 13,270,701 9,212,322 4,058,379 19,769,460 46.60%
2016 11,447,334 8,814,471 2,632,863 23,085,894 38.18%
2017 10,582,235 11,305,756 (723,521) 20,901,389 54.09%
Notes to Schedule of Contributions
Valuation Date January 1, 2016 (rolled forward to June 30, 2017)
Notes Actuarially determined contribution amounts for fiscal year 2017 are calculated based
upon the results of the January 1, 2016 actuarial valuation.
Methods and assumptions used to determine contribution rates:
Actuarial cost method Entry-age normal
Amortization method Level percentage of pay
Remaining amortization period 25 years
Asset valuation method Market value
Inflation 2.85%
Investment rate of return 7.40%
Retirement age Age-based table of rates that are specific to the type of eligibility condition.
Mortality RP2000 Tables, with blue collar adjustments. For Disabled members, the disabled
versions of these tables are assumed. Each of these tables is projected to 2026 using
Scale BB. For pre-retirement deaths, a 50%factor is applied to these tables.
Health care trend rates Year Beginning Connecticut
July 1, Pre-Medicare Medicare Partnership
2017 6.50% 4.50% 4.00%
2018 6.00% 4.50% 5.50%
2019 5.50% 4.50% 5.00%
2020 5.00% 4.25% 4.75%
2021 4.50% 4.00% 4.50%
2022+ 4.50% 4.00% 4.50%
130
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Other Postemployment Benefits Plan
Employees' Retirement System
Schedule of Investment Returns
Fiscal Year
Ending Annual
June 30, Return(')
2017 9.90%
Annual money-weighted rate of return, net of investment expenses
Note: GASB 74 was implemented in fiscal year 2017. This schedule is being built prospectively. Ultimately, 10 years of data
will be presented.
131
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Other Postemployment Benefits Plan
Police and Fire Retirement System
Schedule of Changes in Net OPEB Liability and Related Ratios
Fiscal Year
Ended
June 30, 2017
Total OPEB liability
Service cost $ 3,749,359
Interest on total OPEB liability 15,584,783
Benefit payments (11,065,440)
Net change in total OPEB liability 8,268,702
Total OPEB liability, beginning of year 286,623,495
Total OPEB liability, end of year 294,892,197
Plan fiduciary net position
Employer contributions 12,290,749
OPEB plan net investment income 3,487,200
Benefit payments (11,065,440)
Administrative expense (525,309)
Net change in plan fiduciary net position 4,187,200
Plan fiduciary net position, beginning of year 29,946,038
Plan fiduciary net position, end of year 34,133,238
Net OPEB liability $ 260,758,959
Plan fiduciary net position as a percentage
of total OPEB liability 11.57%
Covered payroll $ 27,582,521
Net OPEB liability as a percentage
of covered payroll 945.38%
Note: GASB 74 was implemented in fiscal year 2017. This schedule is being built prospectively. Ultimately, 10 years of data
will be presented.
132
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Other Postemployment Benefits Plan
Police and Fire Retirement System
Schedule of the Net OPEB Liability
Plan Net Net OPEB
Position as Liability as
Fiscal Year Percentage of Percentage of
Ending Total OPEB Plan Net Net OPEB Total OPEB Covered Covered
June 30, Liability Position Liability Liability Payroll Payroll
2017 $ 294,892,197 $ 34,133,238 $ 260,758,959 11.57% $ 27,582,521 945.38%
Note: GASB 74 was implemented in fiscal year 2017. This schedule is being built prospectively. Ultimately, 10 years of data
will be presented.
133
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Other Postemployment Benefits Plan
Police and Fire Retirement System
Schedule of Contributions
Actual
Contribution as
Fiscal Year Actuarially Contribution Percentage of
Ending Determined Actual Deficiency Covered Covered
June 30, Contribution Contribution (Excess) Payroll Payroll
2008 $ 12,005,858 $ 8,629,563 $ 3,376,295 $ 30,161,000 28.61%
2009 12,258,018 9,673,825 2,584,193 30,443,000 31.78%
2010 16,563,477 9,585,692 6,977,785 28,536,056 33.59%
2011 16,474,153 9,844,226 6,629,927 25,128,835 39.18%
2012 17,844,155 9,888,796 7,955,359 26,121,411 37.86%
2013 17,489,692 11,170,202 6,319,490 25,636,626 43.57%
2014 16,945,536 11,198,663 5,746,873 26,405,725 42.41%
2015 17,923,366 11,561,406 6,361,960 24,407,740 47.37%
2016 17,276,901 12,879,016 4,397,885 27,078,405 47.56%
2017 19,759,521 12,290,749 7,468,772 27,585,521 44.56%
Notes to Schedule of Contributions
Valuation Date January 1, 2016 (rolled forward to June 30, 2017)
Notes Actuarially determined contribution amounts for fiscal year 2017 are calculated based
upon the results of the January 1, 2016 actuarial valuation.
Methods and assumptions used to determine contribution rates:
Actuarial cost method Entry-age normal
Amortization method Level percentage of pay
Remaining amortization period 25 years
Asset valuation method Market value
Inflation 2.85%
Investment rate of return 7.35%
Retirement age Age-based table of rates that are specific to the type of eligibility condition.
Mortality RP2000 Tables, with blue collar adjustments. For Disabled members, the disabled
versions of these tables are assumed. Each of these tables is projected to 2026 using
Scale BB. For pre-retirement deaths, a 50%factor is applied to these tables.
Health care trend rates Year Beginning Connecticut
July 1, Pre-Medicare Medicare Partnership
2017 6.50% 4.50% 4.00%
2018 6.00% 4.50% 5.50%
2019 5.50% 4.50% 5.00%
2020 5.00% 4.25% 4.75%
2021 4.50% 4.00% 4.50%
2022+ 4.50% 4.00% 4.50%
134
CITY OF LANSING, MICHIGAN
Required Supplementary Information
Other Postemployment Benefits Plan
Police and Fire Retirement System
Schedule of Investment Returns
Fiscal Year
Ending Annual
June 30, Return(')
2017 9.89%
Annual money-weighted rate of return, net of investment expenses
Note: GASB 74 was implemented in fiscal year 2017. This schedule is being built prospectively. Ultimately, 10 years of data
will be presented.
135
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136
COMBINING AND INDIVIDUAL FUND FINANCIAL
STATEMENTS AND SCHEDULES
137
CITY OF LANSING, MICHIGAN
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2017
Special Debt Capital
Revenue Service Projects Permanent Totals
Assets
Cash and cash equivalents $ 95,380 $ - $ - $ - $ 95,380
Equity in pooled cash and investments 5,638,758 1,000 5,455,344 1,808,391 12,903,493
Accounts receivable, net 1,870 - 134,067 - 135,937
Special assessments receivable - 288,878 288,878
Loans receivable 1,426,440 - 1,426,440
Accrued interest receivable 2,355,617 2,355,617
Due from other governments 9,310,474 9,310,474
Inventories 805,025 805,025
Prepaids 5,468 - - 5,468
Total assets $ 19,639,032 $ 1,000 $ 5,878,289 $ 1,808,391 $ 27,326,712
Liabilities
Accounts payable $ 1,751,937 $ - $ 283,060 $ - $ 2,034,997
Deposits payable 102,376 - 102,376
Accrued payroll 66,379 66,379
Indemnity bonds 36,425 36,425
Due to other funds 1,600,000 - 1,600,000
Advances from other funds - 257,477 257,477
Due to other governments 984,404 - 984,404
Unearned revenue 1,055,339 - 1,055,339
Total liabilities 5,596,860 540,537 6,137,397
Deferred inflows of resources
Unavailable revenues - loans and
accrued interest receivable 3,582,057 - 3,582,057
Unavailable revenues - special
assessments - 242,499 242,499
Total deferred inflows of resources 3,582,057 242,499 - 3,824,556
Fund balances
Nonspendable 810,493 - - 1,808,391 2,618,884
Restricted 4,553,023 1,000 175,989 - 4,730,012
Committed 5,296,599 - 5,130,362 10,426,961
Unassigned (deficit) (200,000) - (211,098) - (411,098)
Total fund balances 10,460,115 1,000 5,095,253 1,808,391 17,364,759
Total liabilities, deferred inflows of
resources and fund balances $ 19,639,032 $ 1,000 $ 5,878,289 $ 1,808,391 $ 27,326,712
138
CITY OF LANSING, MICHIGAN
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended June 30, 2017
Special Debt Capital
Revenue Service Projects Permanent Totals
Revenues
Taxes and special assessments $ 507,404 $ 503,218 $ 82,893 $ $ 1,093,515
Intergovernmental 20,179,778 - - 20,179,778
Charges for services 3,563,325 554,408 4,117,733
Fines and forfeits 270,845 - 270,845
Interest and rents 22,054 4,789 13,296 40,139
Contributions 10,000 - - 10,000
Otherrevenues 810,725 - - 810,725
Total revenues 25,364,131 503,218 642,090 13,296 26,522,735
Expenditures
Current expenditures:
General government 3,257,370 - - - 3,257,370
Public safety 1,542,649 1,542,649
Public works 1,364 1,364
Highways and streets 10,969,516 10,969,516
Community development 4,142,612 - - 4,142,612
Debt service:
Principal 1,347,396 1,440,000 146,776 2,934,172
Interest 509,440 73,358 - 582,798
Capital outlay 6,463,497 - 2,864,781 9,328,278
Total expenditures 28,233,844 1,513,358 3,011,557 - 32,758,759
Revenues over (under)
expenditures (2,869,713) (1,010,140) (2,369,467) 13,296 (6,236,024)
Other financing sources (uses)
Transfers in 4,544,923 1,009,876 3,772,950 39,540 9,367,289
Transfers out (2,007,107) - (1,276,597) (12,799) (3,296,503)
Total other financing sources (uses) 2,537,816 1,009,876 2,496,353 26,741 6,070,786
Net change in fund balances (331,897) (264) 126,886 40,037 (165,238)
Fund balances, beginning of year 10,792,012 1,264 4,968,367 1,768,354 17,529,997
Fund balances, end of year $ 10,460,115 $ 1,000 $ 5,095,253 $ 1,808,391 $ 17,364,759
139
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140
CITY OF LANSING, MICHIGAN
Nonmajor Special Revenue Funds
Major Streets Fund - This fund accounts for revenues received from the State of Michigan for the
City's share of state gasoline and weight taxes, which is used for maintenance of major streets.
Local Streets Fund - This fund accounts for revenues received from the State of Michigan for the
City's share of state gasoline and weight taxes, which is used for maintenance of local streets.
Drug Law Enforcement Federal Fund - This fund accounts for federal revenues, from the
Departmens of Justice and Treasury, set aside for drug law enforcement under the provisions of
Federal Grant Agreements.
Drug Law Enforcement State and Local Fund - This fund accounts for state and local revenues,
from the Departmens of Justice and Treasury, set aside for drug law enforcement under the
provisions of State of Michigan Public Act 135 of 1985, as amended.
Community Development Block Grant Program Fund - This fund accounts for revenues received
from the Department of Housing and Urban Development. These revenues are restricted to
accomplishing the various objectives of Community Development Block Grant Programs, within
specific target areas.
Downtown Lansing, Inc. Fund - This fund accounts for assessments received from businesses
located in the district. The revenues are used for special events and maintenance of the district.
Building Department Fund - This fund accounts for revenues and expenditures resulting from the
enforcement of the State Construction Code Act of 1999 (PA 245 of 1999).
Parks Department Fund - This fund accounts for contributions and transfers which are restricted
for park expenditures.
State and Federal Grants Fund - This fund accounts for all revenues received from miscellaneous
grants and contributions. These revenues are used for projects as detailed in individual grant
applications.
Tri-County Metro Fund - This fund accounts for the operations of the Tri-County Metro Narcotics
Squad.
141
CITY OF LANSING, MICHIGAN
Combining Balance Sheet
Nonmajor Special Revenue Funds
June 30, 2017
Drug Law Community
Drug Law Enforcement Development
Major Local Enforcement State and Block Grant
Streets Streets Federal Local Program
Assets
Cash and cash equivalents $ - $ - $ $ 23,000 $ -
Equity in pooled cash and investments 1,169,284 174,028 349,650 825,433 372,788
Accounts receivable, net - - - - -
Loans receivable 1,385,000
Accrued interest receivable - - 2,355,617
Due from other governments 5,256,859 1,503,453 1,067,475
Inventories 805,025 - -
Prepaids 2,955 - - -
Total assets $ 7,234,123 $ 1,677,481 $ 349,650 $ 848,433 $ 5,180,880
Liabilities
Accounts payable $ 425,973 $ 152,482 $ - $ 384,465 $ 131,229
Deposits payable - - - -
Accrued payroll - 9,034
Indemnity bonds 36,425 -
Due to other funds - 1,500,000
Due to other governments -
Unearned revenue - - - -
Total liabilities 462,398 152,482 384,465 1,640,263
Deferred inflows of resources
Unavailable revenues - loans and
accrued interest receivable - - - 3,540,617
Fund balances
Nonspendable 807,980 - - - -
Restricted 2,698,515 197,009 349,650 463,968 -
Committed 31265,230 1,327,990 - - 200,000
Unassigned (deficit) - - - - (200,000)
Total fund balances 6,771,725 1,524,999 349,650 463,968 -
Total liabilities, deferred inflows of
resources and fund balances $ 7,234,123 $ 1,677,481 $ 349,650 $ 848,433 $ 5,180,880
142
State and
Downtown Building Parks Federal Tri-County
Lansing, Inc. Department Department Grants Metro Totals
$ - $ - $ - $ - $ 72,380 $ 95,380
51,712 233,813 471,568 1,048,218 942,264 5,638,758
- 1,870 - - - 1,870
- 41,440 1,426,440
- - 2,355,617
1,406,296 76,391 9,310,474
- - - 805,025
2,513 - - - - 5,468
$ 54,225 $ 235,683 $ 471,568 $ 2,495,954 $ 1,091,035 $ 19,639,032
$ 14,118 $ 3,499 $ - $ 541,057 $ 99,114 $ 1,751,937
- - - 102,376 102,376
5,783 31,562 18,840 1,160 66,379
- - - - 36,425
100,000 - 1,600,000
- 742,193 242,211 984,404
- 2,915 1,052,424 - 1,055,339
19,901 37,976 2,454,514 444,861 5,596,860
- - 41,440 - 3,582,057
2,513 - - - 810,493
- 197,707 - 646,174 4,553,023
31,811 - 471,568 - 5,296,599
- - - - (200,000)
34,324 197,707 471,568 646,174 10,460,115
$ 54,225 $ 235,683 $ 471,568 $ 2,495,954 $ 1,091,035 $ 19,639,032
143
CITY OF LANSING, MICHIGAN
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
Nonmajor Special Revenue Funds
For the Year Ended June 30, 2017
Drug Law Community
Drug Law Enforcement Development
Major Local Enforcement State and Block Grant
Streets Streets Federal Local Program
Revenues
Taxes and special assessments $ 100,244 $ - $ - $ $ -
Intergovernmental 9,629,095 2,357,833 17,518 2,677,450
Charges for services 639,210 577,280 - -
Fines and forfeits - - - 171,392
Interest and rents 6,232 760 1,820 4,295
Contributions - - - - -
Otherrevenues 432,559 - - 129,662
Total revenues 10,807,340 2,935,873 19,338 175,687 2,807,112
Expenditures
Current expenditures:
General government - - - - -
Public safety 137,437
Public works - - -
Highways and streets 6,226,066 4,743,450
Community development - -
Debt service:
Principal 321,396 1,026,000
Interest 169,388 340,052 - - -
Capitaloutlay 1,659,896 1,462,115 25,575 38,368 3,025,081
Total expenditures 8,376,746 7,571,617 25,575 175,805 3,025,081
Revenues over (under)
expenditures 2,430,594 (4,635,744) (6,237) (118) (217,969)
Other financing sources (uses)
Transfers in - 3,950,000 - 217,969
Transfers out (2,000,000) - -
Total other financing
sources (uses) (2,000,000) 3,950,000 - 217,969
Net change in fund balances 430,594 (685,744) (6,237) (118) -
Fund balances, beginning of year 6,341,131 2,210,743 355,887 464,086
Fund balances, end of year $ 6,771,725 $ 1,524,999 $ 349,650 $ 463,968 $
144
State and
Downtown Building Parks Federal Tri-County
Lansing, Inc. Department Department Grants Metro Totals
$ 407,160 $ $ $ - $ - $ 507,404
- 4,951,613 546,269 20,179,778
5,965 2,340,870 - - 3,563,325
- - 99,453 270,845
269 1,217 2,454 5,007 22,054
10,000 - - - - 10,000
205,875 - - 42,629 810,725
629,269 2,342,087 2,454 4,994,242 650,729 25,364,131
746,057 2,431,013 - 80,300 - 3,257,370
- - 753,951 651,261 1,542,649
1,364 - 1,364
- 10,969,516
4,142,612 4,142,612
- 1,347,396
- 509,440
- - 252,462 - 6,463,497
746,057 2,431,013 - 5,230,689 651,261 28,233,844
(116,788) (88,926) 2,454 (236,447) (532) (2,869,713)
133,400 - 243,554 - 4,544,923
- (7,107) (2,007,107)
133,400 - 236,447 - 2,537,816
16,612 (88,926) 2,454 - (532) (331,897)
17,712 286,633 469,114 646,706 10,792,012
$ 34,324 $ 197,707 $ 471,568 $ $ 646,174 $ 10,460,115
145
CITY OF LANSING, MICHIGAN
Schedule of Revenues, Expenditures and Changes in Fund Balances
Budget and Actual - Nonmajor Special Revenue Funds
For the Year Ended June 30, 2017
Major Streets
Actual Over
Final (Under) Final
Budget Actual Budget
Revenues
Taxes and special assessments $ 109,000 $ 100,244 $ (8,756)
Intergovernmental 9,074,046 9,629,095 555,049
Charges for services 808,100 639,210 (168,890)
Fines and forfeits - - -
Interest and rents 6,232 6,232
Contributions - - -
Otherrevenues 86,400 432,559 346,159
Total revenues 10,077,546 10,807,340 729,794
Expenditures
Current expenditures:
General government - - -
Public safety
Public works - -
Highways and streets 6,299,208 6,226,066 (73,142)
Community development - -
Debt service:
Principal 324,000 321,396 (2,604)
Interest 173,516 169,388 (4,128)
Capital outlay 4,462,312 1,659,896 (2,802,416)
Total expenditures 11,259,036 8,376,746 (2,882,290)
Revenues over (under) expenditures (1,181,490) 2,430,594 3,612,084
Other financing sources (uses)
Transfers in 113,658 - (113,658)
Transfers out (2,000,000) (2,000,000)
Total other financing sources (uses) (1,886,342) (2,000,000) (113,658)
Net change in fund balances (3,067,832) 430,594 3,498,426
Fund balances, beginning of year 6,341,131 6,341,131 -
Fund balances, end of year $ 3,273,299 $ 6,771,725 $ 3,498,426
146
Local Streets Drug Law Enforcement Federal
Actual Over Actual Over
Final (Under) Final Final (Under) Final
Budget Actual Budget Budget Actual Budget
2,592,040 2,357,833 (234,207) 17,518 17,518
750,000 577,280 (172,720) - -
760 760 1,820 1,820
3,342,040 2,935,873 (406,167) 19,338 19,338
5,005,596 4,743,450 (262,146)
1,026,000 1,026,000
357,704 340,052 (17,652) - -
2,527,927 1,462,115 (1,065,812) 306,800 25,575 (281,225)
8,917,227 7,571,617 (1,345,610) 306,800 25,575 (281,225)
(5,575,187) (4,635,744) 939,443 (306,800) (6,237) 300,563
3,950,000 3,950,000 - -
3,950,000 3,950,000 - -
(1,625,187) (685,744) 939,443 (306,800) (6,237) 300,563
2,210,743 2,210,743 - 355,887 355,887 -
$ 585,556 $ 1,524,999 $ 939,443 $ 49,087 $ 349,650 $ 300,563
continued...
147
CITY OF LANSING, MICHIGAN
Schedule of Revenues, Expenditures and Changes in Fund Balances
Budget and Actual - Nonmajor Special Revenue Funds
For the Year Ended June 30, 2017
Drug Law Enforcement State and Local
Actual Over
Final (Under) Final
Budget Actual Budget
Revenues
Taxes and special assessments $ $ $
Intergovernmental
Charges for services -
Fines and forfeits 171,392 171,392
Interest and rents 4,295 4,295
Contributions - -
Otherrevenues - -
Total revenues 175,687 175,687
Expenditures
Current expenditures:
General government - -
Public safety 175,100 137,437 (37,663)
Public works - -
Highways and streets
Community development
Debt service:
Principal
Interest - -
Capital outlay 88,200 38,368 (49,832)
Total expenditures 263,300 175,805 (87,495)
Revenues over (under) expenditures (263,300) (118) 263,182
Other financing sources (uses)
Transfers in - -
Transfers out
Total other financing sources (uses) - -
Net change in fund balances (263,300) (118) 263,182
Fund balances, beginning of year 464,086 464,086 -
Fund balances, end of year $ 200,786 $ 463,968 $ 263,182
148
Community Development Block Grant Program Downtown Lansing, Inc.
Actual Over Actual Over
Final (Under) Final Final (Under) Final
Budget Actual Budget Budget Actual Budget
$ $ $ - $ 399,000 $ 407,160 $ 8,160
1,852,395 2,677,450 825,055 - - -
- - - 4,800 5,965 1,165
- 269 269
- - 10,000 10,000 -
1,053,388 129,662 (923,726) 253,500 205,875 (47,625)
2,905,783 2,807,112 (98,671) 667,300 629,269 (38,031)
- - 800,700 746,057 (54,643)
3,100,983 3,025,081 (75,902) -
3,100,983 3,025,081 (75,902) 800,700 746,057 (54,643)
(195,200) (217,969) (22,769) (133,400) (116,788) 16,612
195,200 217,969 22,769 133,400 133,400 -
195,200 217,969 22,769 133,400 133,400
- - - - 16,612 16,612
17,712 17,712 -
$ $ $ $ 17,712 $ 34,324 $ 16,612
continued...
149
CITY OF LANSING, MICHIGAN
Schedule of Revenues, Expenditures and Changes in Fund Balances
Budget and Actual - Nonmajor Special Revenue Funds
For the Year Ended June 30, 2017
Building Department
Actual Over
Final (Under) Final
Budget Actual Budget
Revenues
Taxes and special assessments $ $ $
Intergovernmental
Charges for services 2,460,150 2,340,870 (119,280)
Fines and forfeits - - -
Interest and rents 1,217 1,217
Contributions - -
Otherrevenues - -
Total revenues 2,460,150 2,342,087 (118,063)
Expenditures
Current expenditures:
General government 2,451,000 2,431,013 (19,987)
Public safety - -
Public works
Highways and streets
Community development
Debt service:
Principal
Interest
Capital outlay - -
Total expenditures 2,451,000 2,431,013 (19,987)
Revenues over (under) expenditures 9,150 (88,926) (98,076)
Other financing sources (uses)
Transfers in -
Transfers out
Total other financing sources (uses) -
Net change in fund balances 9,150 (88,926) (98,076)
Fund balances, beginning of year 286,633 286,633
Fund balances, end of year $ 295,783 $ 197,707 $ (98,076)
150
Parks Department State and Federal Grants
Actual Over Actual Over
Final (Under) Final Final (Under) Final
Budget Actual Budget Budget Actual Budget
13,579,388 4,951,613 (8,627,775)
2,454 2,454
- - - 42,629 42,629
2,454 2,454 13,579,388 4,994,242 (8,585,146)
- - 136,213 80,300 (55,913)
1,081,614 753,951 (327,663)
- 1,364 1,364
7,050,020 4,142,612 (2,907,408)
- 4,678,072 252,462 (4,425,610)
41,175 - (41,175) 12,945,920 5,230,689 (7,715,231)
(41,175) 2,454 43,629 633,468 (236,447) (869,915)
- - 261,769 243,554 (18,215)
- (7,107) 7,107
- - 261,769 236,447 (25,322)
(41,175) 2,454 43,629 895,237 - (895,237)
469,114 469,114 - -
$ 427,939 $ 471,568 $ 43,629 $ 895,237 $ (895,237)
continued...
151
CITY OF LANSING, MICHIGAN
Schedule of Revenues, Expenditures and Changes in Fund Balances
Budget and Actual - Nonmajor Special Revenue Funds
For the Year Ended June 30, 2017
Tri-County Metro
Actual Over
Final (Under) Final
Budget Actual Budget
Revenues
Taxes and special assessments $ - $ - $
Intergovernmental 425,000 546,269 121,269
Charges for services - - -
Fines and forfeits 425,000 99,453 (325,547)
Interest and rents - 5,007 5,007
Contributions - -
Otherrevenues - -
Total revenues 850,000 650,729 (199,271)
Expenditures
Current expenditures:
General government - -
Public safety 838,000 651,261 (186,739)
Public works - -
Highways and streets
Community development
Debt service:
Principal
Interest
Capital outlay - -
Total expenditures 838,000 651,261 (186,739)
Revenues over (under) expenditures 12,000 (532) (12,532)
Other financing sources (uses)
Transfers in - -
Transfers out (12,000) (12,000)
Total other financing sources (uses) (12,000) - (12,000)
Net change in fund balances - (532) (532)
Fund balances, beginning of year 646,706 646,706 -
Fund balances, end of year $ 646,706 $ 646,174 $ (532)
concluded
152
CITY OF LANSING, MICHIGAN
Nonmajor Debt Service Funds
2015 Refunding Debt Service Fund - This fund accounts for the accumulation of resources for
payment of the 2015 $320,000 Refunding Building Authority Bonds.
1999 Fire Station Fund - This fund accounts for the accumulation of resources for payment of the
1999 $3,000,000 Unlimited Tax General Obligation Bonds (which was refunding in 2007 in the amont
of $1,780,000).
2001 Fire Station Fund - This fund accounts for the accumulation of resources for the payment of
the 2001 $4,000,000 Unlimited Tax General Obligation Bonds (which was refunding in 2010 in the
amont of $2,470,000).
2014 Technology Bond Fund - This fund accounts for the accumulation of resources for payment of
the 2014 $2,275,000 Limited Tax Capital Improvement Bonds issued for technology improvements.
153
CITY OF LANSING, MICHIGAN
Combining Balance Sheet
Nonmajor Debt Service Funds
June 30, 2017
2015
Refunding 1999 2001 2014
Debt Fire Fire Technology
Service Station Station Bond Totals
Assets
Equity in pooled cash and investments $ $ $ 1,000 $ $ 1,000
Fund balances
Restricted $ $ $ 1,000 $ $ 1,000
154
CITY OF LANSING, MICHIGAN
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
Nonmajor Debt Service Funds
For the Year Ended June 30, 2017
2015
Refunding 1999 2001 2014
Debt Fire Fire Technology
Service Station Station Bond Totals
Revenues
Taxes and special assessments $ - $ 225,697 $ 277,521 $ - $ 503,218
Expenditures
Debt service:
Principal 160,000 200,000 310,000 770,000 1,440,000
Interest 6,427 25,800 25,231 15,900 73,358
Total expenditures 166,427 225,800 335,231 785,900 1,513,358
Revenues under expenditures (166,427) (103) (57,710) (785,900) (1,010,140)
Other financing source
Transfers in 166,427 - 57,549 785,900 1,009,876
Net change in fund balances - (103) (161) - (264)
Fund balances, beginning of year 103 1,161 1,264
Fund balances, end of year $ $ - $ 1,000 $ $ 1,000
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156
CITY OF LANSING, MICHIGAN
Nonmajor Capital Projects Funds
1990 Environmental II Fund - This fund accounts for the proceeds of the 1990 $6,300,000
environmental bonds.
Special Assessments Fund - This fund is used to account for the financing of public improvements
deemed to benefit the properties against which special assessments are levied.
Other Capital Projects Fund - This fund accounts for accounts for miscellaneous capital projects.
157
CITY OF LANSING, MICHIGAN
Combining Balance Sheet
Nonmajor Capital Projects Funds
June 30, 2017
1990 Other
Environ- Special Capital
mental11 Assessments Projects Totals
Assets
Equity in pooled cash and
investments $ 688 $ $ 5,454,656 $ 5,455,344
Accounts receivable, net - 134,067 134,067
Special assessments receivable:
Current 46,379 - 46,379
Deferred - 242,499 - 242,499
Total assets $ 688 $ 288,878 $ 5,588,723 $ 5,878,289
Liabilities
Accounts payable $ - $ - $ 283,060 $ 283,060
Advance from other funds 257,477 - 257,477
Total liabilities 257,477 283,060 540,537
Deferred inflows of resources
Unavailable revenues -
specialassessments - 242,499 - 242,499
Fund balances
Restricted 688 - 175,301 175,989
Committed - 5,130,362 5,130,362
Unassigned (deficit) - (211,098) - (211,098)
Total fund balances (deficit) 688 (211,098) 5,305,663 5,095,253
Total liabilities, deferred inflows of
resources and fund balances $ 688 $ 288,878 $ 5,588,723 $ 5,878,289
158
CITY OF LANSING, MICHIGAN
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
Nonmajor Capital Projects Funds
For the Year Ended June 30, 2017
1990 Other
Environ- Special Capital
mentalll Assessments Projects Totals
Revenues
Special assessments $ $ 82,893 $ - $ 82,893
Charges for services - 554,408 554,408
Interest and rents - 4,789 4,789
Total revenues 82,893 559,197 642,090
Expenditures
Debt service:
Principal - 146,776 146,776
Capital outlay 25,449 (2,908) 2,842,240 2,864,781
Total expenditures 25,449 (2,908) 2,989,016 3,011,557
Revenues over
(under) expenditures (25,449) 85,801 (2,429,819) (2,369,467)
Other financing sources (uses)
Transfers in - 3,772,950 3,772,950
Transfers out (86,647) (1,189,950) (1,276,597)
Total other financing
sources (uses) (86,647) 2,583,000 2,496,353
Net change in fund balances (25,449) (846) 153,181 126,886
Fund balances (deficit),
beginning of year 26,137 (210,252) 5,152,482 4,968,367
Fund balances (deficit),
end of year $ 688 $ (211,098) $ 5,305,663 $ 5,095,253
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160
CITY OF LANSING, MICHIGAN
Nonmajor Permanent Funds
Cemetery Perpetual Care Fund - This fund accounts for transfers from the Cemetery Fund,
representing 15% of lot sales. These funds are invested, and all investment earnings are transferred
to the Cemetery Fund for lot maintenance.
Parks Trust Fund - This fund accounts for contributions made for City parks, the principal of which
must be preserved in accordance with the trust indentures. Income derived from these
contributions is transferred to the Parks Department special revenue fund.
161
CITY OF LANSING, MICHIGAN
Combining Balance Sheet
Nonmajor Permanent Funds
June 30, 2017
Cemetery
Perpetual Parks
Care Trust Totals
Assets
Equity in pooled cash and investments $ 1,807,132 $ 1,259 $ 1,808,391
Fund balances
Nonspendable $ 1,807,132 $ 1,259 $ 1,808,391
162
CITY OF LANSING, MICHIGAN
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
Nonmajor Permanent Funds
For the Year Ended June 30, 2017
Cemetery
Perpetual Parks
Care Trust Totals
Revenues
Interest and rents $ 13,290 $ 6 $ 13,296
Other financing sources (uses)
Transfers in 39,540 - 39,540
Transfers out (12,799) (12,799)
Total other financing sources (uses) 26,741 - 26,741
Net change in fund balances 40,031 6 40,037
Fund balances, beginning of year 1,767,101 1,253 1,768,354
Fund balances, end of year $ 1,807,132 $ 1,259 $ 1,808,391
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164
CITY OF LANSING, MICHIGAN
Nonmajor Enterprise Funds
Cemetery Fund - This fund accounts for the operation of City-owned cemeteries.
Golf Fund - This fund accounts for the operation of the City-owned golf courses.
Garbage and Rubbish Collection Fund - This fund accounts for the provision of household solid
waste disposal services to participating residents of the City.
Recycling Fund - This fund accounts for the provision of recycling services to participating residents
of the City.
165
CITY OF LANSING, MICHIGAN
Combining Statement of Net Position
Nonmajor Enterprise Funds
June 30, 2017
Garbage and
Rubbish
Cemetery Golf Collection Recycling Totals
Assets
Current assets:
Cash and cash equivalents $ 200 $ 300 $ 47,508 $ - $ 48,008
Equity in pooled cash and investments 154,782 127,051 299,213 1,178,527 1,759,573
Accounts receivable, net - - 65,266 8,166 73,432
Inventories 48,862 2,462 - - 51,324
Total current assets 203,844 129,813 411,987 1,186,693 1,932,337
Noncurrent assets:
Capital assets not being depreciated 57,740 446,501 - - 504,241
Capital assets being depreciated, net 106,879 1,973,315 752,531 2,832,725
Total noncurrent assets 164,619 2,419,816 - 752,531 3,336,966
Total assets 368,463 2,549,629 411,987 1,939,224 5,269,303
Deferred outflows of resources
Deferred pension amounts 102,405 104,962 274,477 344,422 826,266
Liabilities
Current liabilities:
Accounts payable 65,026 3,232 5,032 32,910 106,200
Accrued interest payable - - - 5,046 5,046
Accrued payroll 1,608 17,374 - - 18,982
Unearned revenues - 20,400 108,472 - 128,872
Current portion of:
Bonds and notes payable - - - 221,223 221,223
Compensated absences 2,019 - 6,324 14,829 23,172
Total current liabilities 68,653 41,006 119,828 274,008 503,495
Noncurrent liabilities:
Bonds and notes payable, net
of current portion - - - 808,500 808,500
Compensated absences, net
of current portion 12,735 31,253 39,887 93,533 177,408
Net pension liability 1,021,362 1,070,764 2,539,129 3,906,332 8,537,587
Total noncurrent liabilities 1,034,097 1,102,017 2,579,016 4,808,365 9,523,495
Total liabilities 1,102,750 1,143,023 2,698,844 5,082,373 10,026,990
Deferred inflows of resources
Deferred pension amounts 93,311 100,831 207,002 416,171 817,315
Net position
Net investment in capital assets 164,619 2,419,816 - (277,192) 2,307,243
Unrestricted (deficit) (889,812) (1,009,079) (2,219,382) (2,937,706) (7,055,979)
Total net position $ (725,193) $ 1,410,737 $ (2,219,382) $ (3,214,898) $ (4,748,736)
166
CITY OF LANSING, MICHIGAN
Combining Statement of Revenues, Expenses and Changes in Fund Net Position
Nonmajor Enterprise Funds
For the Year Ended June 30, 2017
Garbage and
Rubbish
Cemetery Golf Collection Recycling Totals
Operating revenues
Charges for services $ 403,663 $ 256,218 $ 1,952,897 $ 3,614,794 $ 6,227,572
Operating expenses
Personal services 319,891 500,693 748,147 1,783,880 3,352,611
Purchase of goods and services 555,994 224,969 795,233 1,339,250 2,915,446
Depreciation 10,694 72,295 - 301,012 384,001
Total operating expenses 886,579 797,957 1,543,380 3,424,142 6,652,058
Operating income (loss) (482,916) (541,739) 409,517 190,652 (424,486)
Nonoperating revenues (expenses)
Interest revenue 2,177 661 1,557 6,132 10,527
Gain on sale of capital assets - 2,015 - - 2,015
Interest expense and fees (4,607) (29,271) (33,878)
Capital contribution to others - - (214,486) (214,486)
Total nonoperating revenues
(expenses) 2,177 (1,931) 1,557 (237,625) (235,822)
Income (loss) before transfers (480,739) (543,670) 411,074 (46,973) (660,308)
Transfers in 374,249 711,500 - 1,085,749
Transfers out (39,540) - - (39,540)
Change in net position (146,030) 167,830 411,074 (46,973) 385,901
Net position, beginning of year (579,163) 1,242,907 (2,630,456) (3,167,925) (5,134,637)
Net position, end of year $ (725,193) $ 1,410,737 $ (2,219,382) $ (3,214,898) $ (4,748,736)
167
CITY OF LANSING, MICHIGAN
Combining Statement of Cash Flows
Nonmajor Enterprise Funds
For the Year Ended June 30, 2017
Garbage and
Rubbish
Cemetery Golf Collection Recycling Totals
Cash flows from operating activities
Cash received from customers $ 403,663 $ 255,976 $ 1,986,046 $ 3,615,718 $ 6,261,403
Cash payments for goods and services (539,483) (235,387) (825,876) (1,353,787) (2,954,533)
Cash payments to employees (362,584) (542,911) (851,118) (1,970,255) (3,726,868)
Net cash provided by
(used in)operating activities (498,404) (522,322) 309,052 291,676 (419,998)
Cash flows from noncapital
financing activities
Transfers in 374,249 711,500 - - 1,085,749
Transfers out (39,540) - (39,540)
Net cash provided by
noncapital financing activities 334,709 711,500 1,046,209
Cash flows from capital and related
financing activities
Proceeds from sale of capital assets - 2,015 2,015
Acquisition of capital assets (74,512) (74,512)
Capital contributions to others (214,486) (214,486)
Principal paid on long-term debt (105,000) (216,950) (321,950)
Interest paid on long-term debt (2,520) (30,334) (32,854)
Net cash used in capital and related
financing activities - (180,017) - (461,770) (641,787)
Cash flows from investing activities
Interest and dividends received 2,177 661 1,557 6,132 10,527
Net change in cash and cash equivalents (161,518) 9,822 310,609 (163,962) (5,049)
Cash and cash equivalents,
beginning of year 316,500 117,529 36,112 1,342,489 1,812,630
Cash and cash equivalents,
end of year $ 154,982 $ 127,351 $ 346,721 $ 1,178,527 $ 1,807,581
Reconciliation to statement of net position
Cash and cash equivalents $ 200 $ 300 $ 47,508 $ - $ 48,008
Equity in pooled cash and investments 154,782 127,051 299,213 1,178,527 1,759,573
$ 154,982 $ 127,351 $ 346,721 $ 1,178,527 $ 1,807,581
continued...
168
CITY OF LANSING, MICHIGAN
Combining Statement of Cash Flows
Nonmajor Enterprise Funds
For the Year Ended June 30, 2017
Garbage and
Rubbish
Cemetery Golf Collection Recycling Totals
Reconciliation of operating income (loss)
to net cash provided by(used in)
operating activities
Operating income (loss) $ (482,916) $ (541,739) $ 409,517 $ 190,652 $ (424,486)
Adjustments to reconcile operating
income (loss)to net cash provided by
(used in)operating activities:
Depreciation 10,694 72,295 - 301,012 384,001
Changes in:
Accounts receivable - 912 9,409 924 11,245
Inventories - 1,561 10,579 - 12,140
Accounts payable 16,511 (9,682) (41,222) (14,537) (48,930)
Accrued payroll (1,491) (3,950) (5,441)
Due to other funds (2,297) - (2,297)
Unearned revenues (1,154) 23,740 22,586
Compensated absences (5,929) 516 (30,266) (15,888) (51,567)
Net pension liability and related
deferred amounts (35,273) (38,784) (72,705) (170,487) (317,249)
Net cash provided by
(used in)operating activities $ (498,404) $ (522,322) $ 309,052 $ 291,676 $ (419,998)
concluded
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170
CITY OF LANSING, MICHIGAN
Internal Service Funds
Fleet Maintenance Fund - This fund accounts for the costs of maintaining the City's fleet of
vehicles and heavy equipment.
Fringe Benefits Fund - This fund accounts for the costs of the City's fringe benefits.
Engineering Fund - This fund accounts for the operations of the City's engineering department.
Information Technology Fund - This fund accounts for the operations of the City's information
technology department.
171
CITY OF LANSING, MICHIGAN
Combining Statement of Net Position
Internal Service Funds
June 30, 2017
Fleet Fringe Information
Maintenance Benefits Engineering Technology Totals
Assets
Current assets:
Cash and cash equivalents $ 57,842 $ - $ - $ - $ 57,842
Equity in pooled cash and investments 2,531,845 1,825,080 631,958 764,018 5,752,901
Accounts receivable, net 8,078 62,925 - - 71,003
Inventories 481,514 - - 481,514
Prepaids 625 297,740 1,250 - 299,615
Total current assets 3,079,904 2,185,745 633,208 764,018 6,662,875
Noncurrent assets:
Capital assets not being
depreciated 92,892 - - - 92,892
Capital assets being depreciated,
net 10,849,332 1,560,905 12,410,237
Total noncurrent assets 10,942,224 1,560,905 - 12,503,129
Total assets 14,022,128 2,185,745 2,194,113 764,018 19,166,004
Liabilities
Current liabilities:
Accounts payable 79,820 457,439 515 240,358 778,132
Accrued interest payable 26,253 - - - 26,253
Accrued payroll 60,871 17,934 58,944 25,386 163,135
Claims incurred but not reported - 885,000 - - 885,000
Current portion of:
Bonds and notes payable 832,965 - - 832,965
Compensated absences 61,224 - 4,611 65,835
Total current liabilities 1,061,133 1,360,373 59,459 270,355 2,751,320
Noncurrent liabilities:
Bonds and notes payable,
net of current portion 3,030,050 - - - 3,030,050
Compensated absences,
net of current portion 117,294 52,124 459,018 141,440 769,876
Total noncurrent liabilities 3,147,344 52,124 459,018 141,440 3,799,926
Total liabilities 4,208,477 1,412,497 518,477 411,795 6,551,246
Net position
Net investment in capital assets 7,079,209 - 1,560,905 - 8,640,114
Unrestricted 2,734,442 773,248 114,731 352,223 3,974,644
Total net position $ 9,813,651 $ 773,248 $ 1,675,636 $ 352,223 $ 12,614,758
172
CITY OF LANSING, MICHIGAN
Combining Statement of Revenues, Expenses and Changes in Fund Net Position
Internal Service Funds
For the Year Ended June 30, 2017
Fleet Fringe Information
Maintenance Benefits Engineering Technology Totals
Operating revenues
Charges for services $ 8,360,499 $ 60,579,533 $ 4,427,060 $ 4,637,481 $ 78,004,573
Operating expenses
Personal services 3,172,166 292,704 3,198,142 1,430,034 8,093,046
Purchase of goods and services 3,274,578 61,209,286 1,203,502 2,962,873 68,650,239
Depreciation 1,888,364 - 45,431 - 1,933,795
Total operating expenses 8,335,108 61,501,990 4,447,075 4,392,907 78,677,080
Operating income (loss) 25,391 (922,457) (20,015) 244,574 (672,507)
Nonoperating revenues (expenses)
Gain on sale of capital assets 54,365 - 54,365
Interest expense and fees (141,962) (141,962)
Total nonoperating revenues
(expenses) (87,597) - (87,597)
Income (loss) before transfers (62,206) (922,457) (20,015) 244,574 (760,104)
Transfers in 1,650,000 - 1,650,000
Transfers out - (785,900) (785,900)
Change in net position 1,587,794 (922,457) (20,015) (541,326) 103,996
Net position, beginning of year 8,225,857 1,695,705 1,695,651 893,549 12,510,762
Net position, end of year $ 9,813,651 $ 773,248 $ 1,675,636 $ 352,223 $ 12,614,758
173
CITY OF LANSING, MICHIGAN
Combining Statement of Cash Flows
Internal Service Funds
For the Year Ended June 30, 2017
Fleet Fringe Information
Maintenance Benefits Engineering Technology Totals
Cash flows from operating activities
Cash received from interfund
services $ 8,352,421 $ 61,096,863 $ 4,427,060 $ 4,637,481 $ 78,513,825
Cash payments for goods
and services (3,603,989) (61,095,752) (1,240,350) (2,751,490) (68,691,581)
Cash payments to employees (3,200,423) (47,635) (3,149,312) (1,391,260) (7,788,630)
Net cash provided by (used in)
operating activities 1,548,009 (46,524) 37,398 494,731 2,033,614
Cash flows from noncapital
financing activities
Transfers in 1,650,000 - - 1,650,000
Transfers out - (785,900) (785,900)
Net cash provided by (used in)
noncapital financing activities 1,650,000 (785,900) 864,100
Cash flows from capital and related
financing activities
Proceeds from sale of capital assets 102,751 102,751
Acquisition and construction of
capital assets (2,191,524) (2,191,524)
Principal paid on long-term debt (893,799) (893,799)
Interest paid on long-term debt (147,541) (147,541)
Net cash used in capital and related
financing activities (3,130,113) - (3,130,113)
Net change in cash and cash equivalents 67,896 (46,524) 37,398 (291,169) (232,399)
Cash and cash equivalents,
beginning of year 2,521,791 1,871,604 594,560 1,055,187 6,043,142
Cash and cash equivalents,
end of year $ 2,589,687 $ 1,825,080 $ 631,958 $ 764,018 $ 5,810,743
Reconciliation to statement of net position
Cash and cash equivalents $ 57,842 $ - $ - $ - $ 57,842
Equity in pooled cash and investments 2,531,845 1,825,080 631,958 764,018 5,752,901
$ 2,589,687 $ 1,825,080 $ 631,958 $ 764,018 $ 5,810,743
continued...
174
CITY OF LANSING, MICHIGAN
Combining Statement of Cash Flows
Internal Service Funds
For the Year Ended June 30, 2017
Fleet Fringe Information
Maintenance Benefits Engineering Technology Totals
Reconciliation of operating income (loss)
to net cash provided by (used in)
operating activities
Operating income (loss) $ 25,391 $ (922,457) $ (20,015) $ 244,574 $ (672,507)
Adjustments to reconcile operating
income (loss) to net cash provided
by (used in) operating activities:
Depreciation 11888,364 - 45,431 1,933,795
Change in:
Accounts receivable (8,078) 517,330 - 509,252
Inventories (106,623) - - (106,623)
Prepaids (625) 58,630 (1,250) 6,242 62,997
Accounts payable (222,163) 54,904 (35,598) 205,141 2,284
Accrued payroll 638 10,702 11,405 5,178 27,923
Claims incurred but not reported
reported - 228,936 - - 228,936
Compensated absences (28,895) 5,431 37,425 33,596 47,557
Net cash provided by (used in)
operating activities $ 1,548,009 $ (46,524) $ 37,398 $ 494,731 $ 2,033,614
concluded
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CITY OF LANSING, MICHIGAN
Agency Funds
Bail Bonds Fund - This fund is used to hold cash received by the District Court for bail bonds.
Garnishment, Indemnity Bond and Restitution Fund - This fund is used to hold cash received by the
District Court for garnishment payments until claimed, and to hold indemnity bonds deposited
relating to civil disputes until the Court rules on the case.
177
CITY OF LANSING, MICHIGAN
Combining Statement of Fiduciary Assets and Liabilities
Agency Funds
June 30, 2017
54-A District Court
Garnishment,
Bail Indemnity Bond
Bonds and Restitution Totals
Assets
Equity in pooled cash and investments $ 65,651 $ 4,240 $ 69,891
Liabilities
Undistributed receipts $ 65,651 $ 4,240 $ 69,891
178
CITY OF LANSING, MICHIGAN
Combining Statement of Changes in Fiduciary Assets and Liabilities
Agency Funds
For the Year Ended June 30, 2017
Beginning Ending
Balance Additions Deletions Balance
54-A District Court - Bail Bonds
Assets
Equity in pooled cash and investments $ 63,498 $ 469,879 $ 467,726 $ 65,651
Liabilities
Undistributed receipts $ 63,498 $ 469,879 $ 467,726 $ 65,651
54-A District Court - Garnishment,
Indemnity Bond and Restitution
Assets
Equity in pooled cash and investments $ 4,240 $ 63,640,006 $ 63,640,006 $ 4,240
Liabilities
Undistributed receipts $ 4,240 $ 63,640,006 $ 63,640,006 $ 4,240
Total - all agency funds
Assets
Equity in pooled cash and investments $ 67,738 $ 64,109,885 $ 64,107,732 $ 69,891
Liabilities
Undistributed receipts $ 67,738 $ 64,109,885 $ 64,107,732 $ 69,891
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180
STATISTICAL SECTION
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CITY OF LANSING, MICHIGAN
Statistical Section Table of Contents
This part of the City of Lansing, Michigan's (the "City") comprehensive annual financial report presents
detailed information as a context for understanding what the information in the financial statements,
note disclosures, and required supplementary information says about the City's overall financial health.
Page
Financial Trends These schedules contain trend information to help the reader
(Tables 1-4) understand how the City's financial performance and well-being
have changed over time. 185
Revenue Capacity These schedules contain information to help the reader assess
(Tables 5-8) the factors affecting the City's ability to generate its property
taxes. 190
Debt Capacity These schedules present information to help the reader assess
(Tables 9-13) the affordability of the City's current levels of outstanding debt
and the City's ability to issue additional debt in the future. 194
Demographic and These schedules offer demographic and economic indicators to
Economic Information help the reader understand the environment within which the
(Tables 14-15) City's financial activities take place and to help make
comparisons over time and with other governments. 199
Operating Information These schedules contain information about the City's operations
(Tables 16-18) and resources to help the reader understand how the City's
financial information relates to the services the City provides and
the activities it performs. 202
Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive
annual financial reports for the relevant year.
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184
CITY OF LANSING, MICHIGAN Table 1 -Unaudited
Net Position by Component
Last Ten Fiscal Years
- 2017 -' � 20150) —L 20�E 2012 2011 2010 2009
Governmental activities
Net investment in capital assets $ 149,533,948 $ 149,676,860 $ 151,785,916 $ 150,976,010 $ 154,372,604 $ 163,723,249 $ 180,571,237 $ 186,536,428 $ 191,516,475 $ 187,054,852
Restricted 10,993,950 12,922,525 12,311,541 13,133,137 12,552,011 14,524,584 14,777,571 14,304,689 17,139,090 34,554,539
Unrestricted(deficit) (276,790,945) (265,678,371) (251,453,207) (46,344,555) (39,467,672) (34,371,855) (18,840,717) (7,649,432) 6,589,790 (3,124,027)
Total governmental activities net position $(116,263,047) $(103,078,986) $ (87,355,750) $ 117,764,592 $ 127,456,943 $ 143,875,978 $ 176,508,091 $ 193,191,685 $ 215,245,355 $ 218,485,364
Business-type activities
Net investment in capital assets $ 224,161,744 $ 220,436,882 $ 218,813,478 $ 214,458,841 $ 212,682,278 $ 209,584,457 $ 204,149,751 $ 194,854,140 $ 185,430,669 $ 178,526,049
Restricted 1,818,671 2,764,963 2,889,096 8,746,096 11,077,134 12,382,060 13,080,302 19,917,341 19,454,812 30,892,739
Unrestricted 25,415,447 19,401,320 17,242,167 37,891,053 31,943,581 32,196,598 34,177,453 30,193,568 23,730,694 16,330,517
Total business-type activities net position $ 251,395,862 $ 242,603,165 $ 238,944,741 $ 261,095,990 $ 255,702,993 $ 254,163,115 $ 251,407,506 $ 244,965,049 $ 228,616,175 $ 225,749,305
Primary government
Net investment in capital assets $ 373,695,692 $ 370,113,742 $ 370,599,394 $ 365,434,851 $ 367,054,882 $ 373,307,706 $ 384,720,988 $ 381,390,568 $ 376,947,144 $ 365,580,901
Restricted 12,812,621 15,687,488 15,200,637 21,879,233 23,629,145 26,906,644 27,857,873 34,222,030 36,593,902 65,447,278
Unrestricted(deficit) (251,375,498) (246,277,051) (234,211,040) (8,453,502) (7,524,091) (2,175,257) 15,336,736 22,544,136 30,320,484 13,206,490
Total primary government net position $ 135,132,815 $ 139,524,179 $ 151,588,991 $ 378,860,582 $ 383,159,936 $ 398,039,093 $ 427,915,597 $ 438,156,734 $ 443,861,530 $ 444,234,669
Note:No discretely presented component units shown
(1)GASB Statement No.68 was implemented for the fiscal year ended June 30,2015.This resulted in presentation of the City's net pension liability on the statement of net position.Prior years were not restated.
185
CITY OF LANSING, MICHIGAN Table 2-Unaudited
Change in Net Position
Last Ten Fiscal Years
--------�t 2008
Expenses
Governmental activities:
General government $ 21,778,154 $ 27,993,414 $ 25,225,893 $ 24,771,054 $ 27,438,065 $ 30,841,776 $ 25,665,269 $ 30,326,671 $ 26,426,242 $ 28,901,548
Public safety 91,829,441 85,739,408 81,827,437 78,142,897 77,133,469 82,369,004 83,546,997 84,566,215 71,236,947 76,211,756
Public works 28,983,891 28,212,049 27,815,970 37,243,516 29,984,955 33,144,303 26,355,375 29,252,516 37,588,680 40,032,746
Recreation and culture 9,441,519 10,336,168 6,515,590 8,670,918 7,713,098 8,889,142 8,245,451 7,312,480 7,298,385 7,677,083
Community development 12,349,663 10,642,102 10,270,404 7,602,229 16,939,572 13,623,946 12,825,028 9,715,087 6,378,286 6,382,336
Interest on long-term debt 1,201,846 1,424,215 1,291,846 1,340,818 1,475,051 1,949,825 2,116,535 2,229,288 1,803,125 1,481,658
Total governmental activities expenses 165,584,514 164,347,356 152,947,140 157,771,432 160,684,210 170,817,996 158,754,655 163,402,257 150,731,665 160,687,127
Business-type activities:
Sewage disposal system 27,567,228 28,487,957 27,506,843 28,682,809 26,298,964 26,836,597 26,444,741 24,931,075 26,247,188 27,382,736
Municipal parking system 6,866,747 7,651,077 7,605,461 7,851,702 8,108,373 9,491,376 9,896,498 8,305,095 8,353,063 10,188,065
Cemetery 886,579 708,545 632,485 722,270 633,050 639,000 755,766 659,584 689,979 675,672
Golf 802,564 845,575 852,634 935,671 892,117 810,372 846,817 869,003 927,200 1,072,505
Garbage and rubbish collection 1,543,380 2,085,728 1,712,671 1,722,843 1,557,708 1,558,024 1,515,600 1,451,059 1,547,372 1,436,642
Recycling 3,667,899 4,092,278 3,623,276 3,263,553 3,650,292 3,041,328 2,809,353 2,804,047 3,008,750 2,940,366
Potter Park Zoo - - - - - - - - - (156,270)
Total business-type activities expenses 41,334,397 43,871,160 41,933,370 43,178,848 41,140,504 42,376,697 42,268,775 39,019,863 40,773,552 43,539,716
Total primary government expenses 206,918,911 208,218,516 194,880,510 200,950,280 201,824,714 213,194,693 201,023,430 202,422,120 191,505,217 204,226,843
Program revenues
Governmental activities:
Charges for services:
General government 7,295,556 7,279,427 6,815,975 6,820,261 6,162,713 6,428,110 6,742,306 6,565,263 5,188,510 5,938,911
Public safety 3,476,966 2,909,054 3,344,183 2,122,023 4,083,222 8,525,524 8,975,173 8,589,146 9,817,421 12,705,181
Public works 1,836,466 3,011,894 1,923,303 2,129,126 1,622,738 2,797,443 2,449,606 2,788,112 4,565,013 4,364,525
Recreation and culture 617,604 673,840 619,834 800,293 594,349 557,609 685,120 587,906 1,217,445 1,556,260
Community development 67,312 67,272 67,264 67,323 67,349 67,344 122,326 69,250 50,132 66,308
Operating grants and contributions 25,157,629 24,561,960 24,658,955 28,234,803 29,322,435 31,928,983 30,154,681 27,515,892 26,462,211 20,356,292
Capital grants and contributions 63,488 904,298 2,910,660 3,365,682 3,124,288 260,656 189,414 3,109,410 2,571,741 2,531,974
Total governmental activities program revenues 38,515,021 39,407,745 40,340,174 43,539,511 44,977,094 50,565,669 49,318,626 49,224,979 49,872,473 47,519,451
Business-type activities:
Charges for services:
Sewage disposal system 34,755,896 32,368,491 31,730,416 31,759,698 30,825,174 29,915,799 29,205,945 28,907,772 27,446,304 28,023,322
Municipal parking system 6,906,091 7,090,335 6,988,879 7,453,476 5,267,627 6,858,606 7,539,179 7,396,219 7,539,611 10,090,566
Cemetery 403,663 312,929 335,379 289,565 314,913 240,394 225,947 226,973 248,314 218,688
Golf 256,218 313,164 363,559 366,567 373,000 390,134 382,546 438,315 448,067 607,922
Garbage and rubbish collection 1,952,897 1,871,665 1,744,999 1,664,201 1,131,659 1,459,101 1,507,577 1,677,428 1,486,531 1,617,717
Recycling 3,614,794 3,627,070 3,624,671 3,508,536 3,434,622 2,818,364 2,609,423 2,651,309 2,945,061 3,039,089
Potter Park Zoo - - - - - - - - - (115)
Operating grants and contributions 1,391,326 1,312,362 1,143,085 2,574,949 1,193,571 1,331,737 4,456,708 1,535,907 1,541,913 -
Capital grants and contributions 100,000 - - - 2,683,657 1,439,044 11,928,108 60,318 196,317
Total business-type activities program revenues 49,380,885 46,896,016 45,930,988 47,616,992 42,540,566 45,697,792 47,366,369 54,762,031 41,716,119 43,793,506
Total primary government program revenues 87,895,906 86,303,761 86,271,162 91,156,503 87,517,660 96,263,461 96,684,995 103,987,010 91,588,592 91,312,957
Net(expenses)revenues
Governmental activities (127,069,493) (124,939,611) (112,606,966) (114,231,921) (115,707,116) (120,252,327) (109,436,029) (114,177,278) (100,859,192) (113,167,676)
Business-type activities 8,046,488 3,024,856 3,997,618 4,438,144 1,400,062 3,321,095 5,097,594 15,742,168 942,567 253,790
Total primary government net expense (119,023,005) (121,914,755) (108,609,348) (109,793,777) (114,307,054) (116,931,232) (104,338,435) (98,435,110) (99,916,625) (112,913,886)
continued...
186
CITY OF LANSING, MICHIGAN
Change in Net Position
Last Ten Fiscal Years
---------0 2008 '
General revenues and other changes in net position
Governmental activities:
Taxes:
Property taxes $ 40,568,278 $ 38,578,548 $ 39,657,382 $ 38,079,548 $ 38,668,837 $ 33,506,860 $ 37,233,590 $ 39,010,960 $ 39,141,928 $ 38,607,761
Income taxes 35,694,010 34,573,130 31,660,923 31,450,913 29,850,755 27,943,070 28,699,749 27,408,443 29,312,762 31,168,012
Unrestricted grants and contributions 38,108,544 36,532,275 36,330,976 35,677,910 31,425,718 26,441,961 27,254,574 25,847,423 27,318,313 28,180,799
Investment earnings 125,539 99,058 26,353 36,836 58,588 69,265 89,735 246,495 978,034 1,706,572
Miscellaneous 135,270 63,079 280,280 - - 123,066 108,601 75,094 32,310 -
Transfers (746,209) (629,715) (644,485) (705,637) (583,117) (464,008) (633,814) (464,807) (509,728) 7,420,667
Total governmental activities 113,885,432 109,216,375 107,311,429 104,539,570 99,420,781 87,620,214 92,752,435 92,123,608 96,273,619 107,083,811
Business-type activities:
Investment earnings - - 17,874 246,616 356,467 271,067 689,883 141,899 413,850 1,883,034
Miscellaneous - 3,853 - 2,600 - (1,300,561) 21,166 - 725 5,348
Transfers 746,209 629,715 644,485 705,637 583,117 464,008 633,814 464,807 509,728 (7,420,667)
Total business-type activities 746,209 633,568 662,359 954,853 939,584 (565,486) 1,344,863 606,706 924,303 (5,532,285)
Total primary government 114,631,641 109,849,943 107,973,788 105,494,423 100,360,365 87,054,728 94,097,298 92,730,314 97,197,922 101,551,526
Changes in net position
Governmental activities (13,184,061) (15,723,236) (5,295,537) (9,692,351) (16,286,335) (32,632,113) (16,683,594) (22,053,670) (4,585,573) (6,083,865)
Business-type activities 8,792,697 3,658,424 4,659,977 5,392,997 2,339,646 2,755,609 6,442,457 16,348,874 1,866,870 (5,278,495)
Total primary government $ (4,391,364) $ (12,064,812) $ (635,560) $ (4,299,354) $ (13,946,689) $ (29,876,504) $ (10,241,137) $ (5,704,796) $ (2,718,703) $ (11,362,360)
concluded
187
CITY OF LANSING, MICHIGAN Table 3-Unaudited
Fund Balances, Governmental Funds
Last Ten Fiscal Years
1 2017 2016 0 —` 2014 -1 2013 . 2011 (1) 20�IL 2009 200�
General fund
Nonspendable $ 28,342 $ 492,549 $ 35,424 $ 75,738 $ 75,738 $ 92,538 $ 171,586 $ - $ $ -
Restricted - - 10,044 9,400 9,400 16,256 41,129
Committed 385,067 428,106 837,761 2,976,408 2,976,408 65,373 178,081
Unassigned 15,283,857 12,407,748 9,783,911 5,633,528 5,633,528 5,198,032 4,939,691 - -
Reserved - - - - - - - 102,732 1,320,375 1,765,288
Unreserved - - - - - - - 389,061 3,755,862 5,465,164
Total general fund 15,697,266 13,328,403 10,667,140 8,695,074 8,695,074 5,372,199 5,330,487 491,793 5,076,237 7,230,452
All other governmental funds
Nonspendable 2,618,884 2,578,331 2,619,065 2,671,151 2,671,151 2,852,004 3,006,507 - - -
Restricted 4,730,012 6,934,665 6,865,580 4,368,983 4,368,983 5,566,421 7,412,008
Committed 10,426,961 8,427,253 7,110,485 4,035,145 4,035,145 4,109,131 4,908,740
Unassigned(deficit) (411,098) (410,252) (528,144) (619,931) (619,931) (543,774) (371,285) - - -
Reserved 1,177,998 324,366 365,351
Unreserved,reported in:
Special revenue funds 12,029,680 13,394,485 14,716,755
Capital projects funds 11,614,644 12,010,219 17,862,441
Debt service funds 126,434 186,636 256,144
Permanent funds 1,649,550 1,630,098 1,609,992
Total all other governmental funds 17,364,759 17,529,997 16,066,986 10,455,348 10,455,348 11,983,782 14,955,970 26,598,306 27,545,804 34,810,683
Total all governmental funds $ 33,062,025 $ 30,858,400 $ 26,734,126 $ 19,150,422 $ 19,150,422 $ 17,355,981 $ 20,286,457 $ 27,090,099 $ 32,622,041 $ 42,041,135
(1)The City implemented GASB 54 for the Fiscal Year Ended June 30,2011. Prior years were not restated retroactively.
188
CITY OF LANSING, MICHIGAN Table 4-Unaudited
Changes in Fund Balances of Governmental Funds EL -
Last Ten Fiscal Years
2017 ` 7,wr EMEm- ��,�-M011-- 2l
Revenues
Taxes and special assessments $ 40,691,325 $ 38,782,759 $ 39,470,249 $ 38,717,552 $ 38,717,552 $ 33,583,448 $ 37,371,885 $ 39,279,343 $ 39,258,893 $ 38,775,722
Income taxes 35,694,010 34,573,130 31,660,923 29,850,755 29,850,755 27,943,070 28,699,749 27,408,443 29,312,762 31,168,012
Licenses and permits 1,494,298 1,559,638 1,551,125 1,509,402 1,509,402 1,538,325 1,598,804 1,414,906 1,325,119 1,429,075
Intergovernmental 36,391,761 34,175,112 36,042,377 40,639,183 40,639,183 41,431,793 40,304,785 39,137,217 38,998,039 38,556,616
Charges for services 13,230,822 14,102,447 12,900,490 11,754,381 11,754,381 18,676,398 18,606,304 18,323,158 20,355,642 19,116,593
Fines and forfeits 2,510,945 3,455,541 3,075,427 3,694,351 3,694,351 2,884,328 3,325,728 4,579,175 4,143,000 4,090,397
Interest and rents 201,367 145,011 87,035 53,179 53,179 63,571 88,516 249,464 1,196,559 1,836,485
Contributions 21,983,270 21,663,690 21,561,449 16,247,403 16,247,403 12,369,733 11,821,388 10,606,368 10,372,056 10,894,573
Donations from private sources - - - - - 5,000 - 9,000 44,000 326,768
Otherrevenue 969,317 1,190,624 1,601,497 510,515 510,515 400,074 504,856 473,123 1,054,209 331,248
Total revenues 153,167,115 149,647,952 147,950,572 142,976,721 142,976,721 138,895,740 142,322,015 141,480,197 146,060,279 146,525,489
Expenditures
General government 23,948,368 23,386,445 21,720,206 23,595,321 23,595,321 25,038,589 26,396,516 27,839,564 28,951,805 29,209,458
Public safety 73,683,246 72,264,468 75,510,743 63,943,082 63,943,082 66,161,872 70,397,235 70,820,184 70,082,462 67,715,160
Public works 11,201,515 11,715,510 13,273,332 8,908,673 8,908,673 6,225,177 6,002,823
Highways and streets 10,969,516 10,838,473 10,357,488 9,937,423 9,937,423 8,589,298 8,494,233 14,506,982 14,723,311 14,860,390
Recreation and culture 7,749,245 7,719,906 7,583,085 6,629,453 6,629,453 6,996,562 7,464,193 8,127,700 8,452,768 8,038,290
Community development 4,142,612 3,442,110 3,910,924 - - - - - - -
Other functions 2,710,979 2,927,391 2,704,982 23,699,202 23,699,202 17,999,264 15,675,003 15,182,675 12,599,072 11,805,843
Capital outlay 9,328,278 7,221,346 21,016,808 5,489,617 5,489,617 6,466,084 9,956,103 14,781,728 14,855,863 16,228,127
Debt service:
Interest 1,120,518 1,275,957 931,079 1,378,856 1,378,856 1,836,218 3,210,220 3,270,068 1,801,394 1,607,703
Principal 4,596,159 3,892,862 3,616,297 3,137,159 3,137,159 3,448,080 2,070,552 2,165,237 4,743,146 4,721,581
Issuance costs - - - 42,744 42,744 - 48,804 - - -
Total expenditures 149,450,436 144,684,468 160,624,944 146,761,530 146,761,530 142,761,144 149,715,682 156,694,138 156,209,821 154,186,552
Excess of revenues over(under)expenditures 3,716,679 4,963,484 (12,674,372) (3,784,809) (3,784,809) (3,865,404) (7,393,667) (15,213,941) (10,149,542) (7,661,063)
Other financing sources(uses)
Proceeds from borrowing - 2,090,000 16,761,300 11,932,046 11,932,046 - 2,470,000 10,146,117 - 4,052,979
Proceeds from sale of capital assets 97,255 268 110,533 497,833 497,833 1,398,936 1,210,046 689 1,587,216 -
Payment to escrow agent - (2,162,163) - (6,015,112) (6,015,112) - (2,456,207) - -
Insurance proceeds - - - - - - - - 120,960 -
Transfers in 9,887,627 9,207,856 9,734,572 7,056,932 7,056,932 7,893,879 9,602,095 16,181,590 11,601,871 13,507,521
Transfers out (11,497,936) (10,055,346) (10,002,772) (1,892,449) (1,892,449) (8,357,887) (10,235,909) (16,646,397) (12,579,599) (12,529,754)
Bond premium 80,175 40,945 - - - - - -
Total other financing sources(uses) (1,513,054) (839,210) 16,644,578 11,579,250 11,579,250 934,928 590,025 9,681,999 730,448 5,030,746
Net change in fund balance $ 2,203,625 $ 4,124,274 $ 3,970,206 $ 7,794,441 $ 7,794,441 $ (2,930,476) $ (6,803,642) $ (5,531,942) $ (9,419,094) $ (2,630,317)
Debt service as a percentage of
noncapital expenditures 3.9% 3.7% 3.2% 3.2% 3.2% 3.8% 3.7% 3.9% 4.5% 4.6%
189
CITY OF LANSING, MICHIGAN Table 5 - Unaudited
Assessed and Estimated Actual Value of Taxable Property
Last Ten Fiscal Years
(rate per$1,000 of assessed value)
Fiscal Total Assessed
Year Personal Total Taxable Direct Estimated Value as a
Ended Residential Commercial Industrial Agricultural Developmental Property Assessed Tax Actual Percentage of
June 30, Property Property Property Property Property Valuation Valuation Rate Value Actual Value
2008 $ 1,437,051,392 $765,233,437 $ 192,915,386 $ $ $ 223,995,750 $ 2,619,195,965 15.83 $5,238,391,930 50.0%
2009 1,479,089,611 719,463,319 254,539,254 205,034,000 2,658,126,184 15.83 5,316,252,368 50.0%
2010 1,480,467,389 713,807,797 248,288,931 220,228,175 2,662,792,292 15.70 5,325,584,584 50.0%
2011 1,407,920,589 624,406,132 215,099,428 199,543,400 2,446,969,549 15.70 4,595,182,662 53.3%
2012 1,387,390,250 639,535,400 87,432,000 183,233,681 2,297,591,331 15.70 4,177,384,562 55.0%
2013 1,232,109,181 587,002,900 86,884,400 151,900 - 182,543,900 2,088,692,281 19.70 4,177,384,562 50.0%
2014 1,152,931,800 580,539,700 85,938,200 151,900 2,900 182,024,000 2,001,588,500 19.70 4,002,817,000 50.0%
2015 1,144,848,592 602,472,030 155,934,800 158,100 2,900 183,420,400 2,086,836,822 19.70 4,173,673,644 50.0%
2016 1,162,708,909 643,816,600 162,544,200 175,600 2,900 196,143,891 2,165,392,100 19.70 4,330,784,200 50.0%
2017 1,212,816,985 691,032,435 175,090,600 172,500 2,900 157,759,500 2,236,874,920 19.70 4,473,749,840 50.0%
Source: Lansing City Assessor
190
CITY OF LANSING, MICHIGAN Table 6 - Unaudited
Direct and Overlapping Property Tax Rates
Last Ten Fiscal Years
(rate per$1,000 of assessed value)
Fiscal City Direct Rates Overlapping Rates
Year
Ended Tax Operating Service City County School State College Other
June 30, Year Millage Millage Millage Millage Millage(l) Education Millage Millage(2) Total
2008 2007 14.95 .88 15.83 8.73 20.18 6.00 3.81 8.15 62.70
2009 2008 15.01 .82 15.83 8.87 20.15 6.00 3.81 9.04 63.70
2010 2009 15.44 .26 15.70 8.85 19.95 6.00 3.81 9.93 64.24
2011 2010 15.44 .26 15.70 8.84 19.95 6.00 3.81 9.93 64.23
2012 2011 15.44 .26 15.70 8.85 21.44 6.00 3.81 9.96 65.76
2013 2012 19.44 .26 19.70 9.49 21.73 6.00 3.81 9.96 70.68
2014 2013 19.44 .26 19.70 9.50 21.91 6.00 3.81 9.96 70.88
2015 2014 19.44 .26 19.70 10.20 21.77 6.00 3.81 9.96 71.44
2016 2015 19.44 .26 19.70 9.83 21.83 6.00 3.81 9.96 71.12
2017 2016 19.44 .26 19.70 10.06 22.57 6.00 3.81 9.96 72.10
(1) rates for Lansing School District only
(2) includes Intermediate School, Airport Authority, Capital
Area Transit Authority and Capital Area District Library.
Source: Lansing City Treasurer
191
CITY OF LANSING, MICHIGAN Table 7-Unaudited
Profile of Ten Largest Ad Valorem Taxpayers
Current Year and Nine Years Ago
2017 2008
Percentage Percentage
Taxable of Total Total of Total
Assessed Assessed Assessed Assessed
Taxpayer Valuation Rank Valuation Valuation Rank Valuation
General Motors Corp. $ 47,549,243 1 2.13% $ 134,702,101 1 5.11%
Jackson National Life Insurance Company 45,936,293 2 2.05% 36,738,583 2 1.26%
Consumers Energy 32,123,801 3 1.44% 22,168,948 4 0.85%
Phoenix Development Part I LLC 25,458,523 4 1.14%
Lansing Retail Center LLC 11,423,364 5 0.51% 13,441,453 7 0.51%
Lansing Properties LLC 9,944,400 6 0.44%
Emergent Biodefense Operations 9,889,697 7 0.44%
Eyde Knapp Development LLC 8,035,645 8 0.36%
Edward Rose Realty, Inc. 6,998,978 9 0.31%
Demmer Corporation 6,647,001 10 0.30%
Delta Township Utilities 22,415,570 3 0.86%
Michigan Strategic Fund 19,115,527 5 0.73%
Accident Fund Company 14,467,925 6 0.55%
Trappers Cove LTD Partners 12,854,463 8 0.49%
Sprint Spectrum L.P. 10,693,700 9 0.41%
Heart of the City LLC 10,527,474 10 0.40%
Data furnished from City of Lansing Assessor
192
CITY OF LANSING, MICHIGAN Table 8 - Unaudited
Property Tax Levies and Collections
Last Ten Fiscal Years
Collected within the
Fiscal Year of the Levy Total Collections to Date
Fiscal Year Taxes Levied Current Percent of Delinquent Total Collections
Ended for the Tax Levy Tax Tax as Percent
June 30, Fiscal Year Collection Collected Collection Collection of Levy
2008 $ 44,286,657 $ 44,125,517 99.64% $ 144,587 $ 44,270,104 99.96%
2009 45,567,556 45,468,639 99.78% 72,779 45,541,418 99.94%
2010 44,997,919 44,844,495 99.66% 33,012 44,877,507 99.73%
2011 41,460,916 41,375,354 99.79% 24,416 41,399,770 99.85%
2012 39,948,762 39,863,393 99.79% 19,647 39,883,040 99.84%
2013 40,450,767 39,716,932 98.19% 55,532 39,772,464 98.32%
2014 39,336,952 39,238,902 99.75% 20,866 39,259,768 99.80%
2015 38,329,032 38,258,272 99.82% 49,590 39,259,768 102.43%
2016 38,538,226 38,461,152 99.80% 52,758 38,307,862 99.40%
2017 38,431,072 38,370,929 99.84% 50,344 38,421,273 99.97%
Note: Amounts are net of chargebacks from the County Tax Revolving Funds for taxes still delinquent after three years.
Note: Delinquent Tax Collection represents amounts received in the indicated fiscal year.
Source: City of Lansing Treasurer
193
CITY OF LANSING, MICHIGAN Table 9-Unaudited
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
Governmental Activities Business-Type Activities _
General Special Installment General Total Percentage
IFiscal Obligation Assessment Purchase Obligation Revenue Lease Primary of Personal Per
Year Bonds Debt Agreements E Loans Bonds Bonds Purchases Loans Government Income M
2008 $ 20,914,466 $ $ 14,037,885 $ 1,534,822 $ 175,578,524 $ 41,921,307 $ $ 4,180,000 $ 258,167,004 12.13%(2) $ 2,168 119,100
2009 17,899,203 12,394,082 1,290,479 189,210,199 39,045,570 4,180,000 264,019,533 12.41%(2) 2,217 119,100
2010 26,329,157 10,925,689 1,038,804 199,063,758 36,122,872 4,180,000 277,660,280 13.05%(2) 2,331 119,100
2011 27,804,224 9,564,693 779,580 197,000,901 33,209,092 1,574,209 269,932,699 12.17%(2) 2,362 114,297
2012 25,816,914 8,193,615 512,577 189,536,530 30,135,311 1,637,177 255,832,124 11.32%(3) 2,238 114,297
2013 29,994,604 2,807,838 6,246,743 180,359,931 27,528,327 1,702,664 248,640,107 11.01%(3) 2,175 114,298
2014 27,180,294 3,100,563 7,062,234 174,471,861 24,055,438 1,668,081 - 237,538,471 10.69%(3) 2,078 114,298
2015 27,790,281 16,387,327 7,872,600 167,787,460 19,445,482 1,459,431 240,742,581 10.83%(3) 2,106 114,297
2016 21,968,330 15,268,317 7,872,600 154,303,563 20,671,135 1,246,673 221,330,618 9.88%(3) 1,924 115,056
2017 18,080,040 13,757,531 7,728,428 143,761,916 18,982,246 1,029,723 203,339,884 8.63%(3) 1,753 116,020
(1)population per decennial census by the U.S.Census Bureau
(2)personal income data comes from U.S.Census Bureau,American Community Survey 2005
(3)personal income data comes from U.S.Census Bureau,American Community Survey 2009
194
CITY OF LANSING, MICHIGAN Table 10 - Unaudited
Ratios of General Bonded Debt Outstanding
Last Ten Fiscal Years
Ratio of
Fiscal Debt Net Bonded Net
Year Service Debt Payable Debt to Bonded
Ended Taxable Gross Bonded Monies From Restricted Net Bonded Taxable Debt per
June 30, Population(') Value(3) Debt(') Available Revenues Debt Value Capita
2008 119,100 $2,619,195,965 $ 196,492,990 $ 256,144 $ 184,442,624 $ 11,794,222 0.0045 99
2009 119,100 2,658,126,184 207,109,402 186,636 197,225,199 9,697,567 0.0036 81
2010 119,100 2,662,792,292 225,392,915 126,434 206,198,758 19,067,723 0.0072 160
2011 114,297 2,446,969,549 224,805,125 46,029 203,225,901 21,533,195 0.0088 188
2012 114,297 2,297,591,331 215,353,444 - 194,911,530 20,441,914 0.0089 179
2013 114,298 2,088,692,281 210,354,535 178 184,849,931 25,504,427 0.0122 223
2014 114,298 2,001,588,500 201,652,155 - 178,031,861 23,620,294 0.0118 207
2015 114,297 2,086,836,822 195,577,741 1,000 170,372,460 25,204,281 0.0121 221
2016 115,056 2,165,392,100 176,271,893 1,000 155,873,563 20,397,330 0.0094 177
2017 116,020 2,236,874,920 161,841,956 1,000 144,271,916 17,569,040 0.0079 151
Source: 2000 and 2010 Census by the U.S. Census Bureau
includes all general obligation debt and special assessment debt with governmental obligation
the tax assessment day is December 31 prior to beginning of fiscal year
195
CITY OF LANSING, MICHIGAN Table 11 - Unaudited
Direct and Overlapping Governmental Activities Debt
As of June 30, 2017
Net General
Obligation Amount
Name of Debt % Applicable Applicable
Governmental Unit Outstanding to City to City
Net direct - City $ 39,565,999 100.00% $ 39,565,999
Share of County-issued bonds
Joint Building Authority 1,098,540 100.00% 1,098,540
Drain Commission 1,212,555 100.00% 1,212,555
$ 2,311,095
Overlapping debt
Eaton Intermediate School District $ 350,000 0.58% $ 2,730
Ingham Intermediate School District 1,503,000 22.81% 329,007
Waverly School District 22,670,000 0.22% 54,408
Lansing School District 79,105,000 81.04% 63,291,911
East Lansing School District 92,248,377 3.74% 4,243,425
Holt School District 59,384,839 2.38% 1,401,482
Ingham County 441665,716 26.07% 11,354,025
Eaton County 24,927,354 1.60% 446,200
Clinton County 601,299 0.28% 1,684
Lansing Community College 62,010,000 18.82% 11,254,815
Okemos School District 13,704,098 2.76% 471,421
Mason School District 9,780,000 0.35% 278,730
Grand Ledge School District 43,145,000 1.22% 686,006
Total overlapping debt 93,815,844
Total direct and overlapping debt $ 135,692,938
Note: Overlapping debt percentages are apportioned based upon relative assessed values.
Source: Municipal Advisory Council of Michigan
196
CITY OF LANSING, MICHIGAN Table 12-Unaudited
Legal Debt Margin Information
Last Ten Fiscal Years
Legal Debt Margin Calculation for Fiscal Year 2017
Assessed value,real and personal property $2,236,874,920
Legal debt margin
Debt limitation- 10 percent of total valuation 223,687,492
Debt applicable to limit
Total City Bonded Debt 180,824,202
City Share:
Drain Commission-County Issued 1,212,555
Joint Building Authority-County Issued 1,098,540
TIF Supported Bonds 15,924,214
Lansing Board of Water and Light 307,844,992
506,904,503
Less:
Michigan Transportation(MTF)Bonds $ (510,000)
Sewage Disposal Revenue Bonds (321,139,992)
Pollution Abatement(CSO Project)Bonds (101,545,116)
Share of County-issued bonds (2,311,095) (425,506,203)
Total net debt applicable to limit 81,398,300
Legal debt margin $ 142,289,192
- 2016 2015 -` 2013 'M 0 2012 20 nkm.20f� 2001 2008
Debt limit
$ 223,687,492 $ 216,539,210 $ 208,683,682 $ 205,138,999 $ 208,869,228 $ 233,669,637 $ 268,975,768 $ 298,052,683 $ 298,581,799 $ 318,810,868
Total net debt applicable to limit
81,398,300 86,432,459 91,352,614 93,062,835 91,833,157 92,357,575 100,923,863 98,368,804 79,513,756 87,966,365
Legal debt margin
$ 142,289,192 $ 130,106,751 $ 117,331,068 $ 112,076,164 $ 117,036,071 $ 141,312,062 $ 168,051,905 $ 199,683,880 $ 219,068,043 $ 230,844,503
Total net debt applicable to the limit
as a percentage of debt limit
36.39% 39.92% 43.78% 45.37% 43.97% 39.52% 37.52% 33.00% 26.63% 27.59%
197
CITY OF LANSING, MICHIGAN Table 13 - Unaudited
Pledged-Revenue Coverage
Last Ten Fiscal Years
Sewage Disposal Bonds
Direct Net Revenue
Gross Operating Available for Debt Service Requirements
Revenue Expenses(') Debt Service Principal Interest Total Coverage(2)
2008 $ 29,356,299 $ 15,997,449 $ 13,358,850 $ 2,830,000 $ 2,002,400 $ 4,832,400 2.76
2009 27,759,684 14,206,961 13,552,723 2,840,000 1,900,000 4,740,000 2.86
2010 28,613,004 12,358,472 16,254,532 2,840,000 1,803,425 4,643,425 3.50
2011 29,865,648 12,616,100 17,249,548 2,925,000 1,621,221 4,546,221 3.79
2012 30,178,511 12,562,663 17,615,848 3,040,000 1,448,856 4,488,856 3.92
2013 31,169,428 12,112,994 19,056,434 3,160,000 1,111,390 4,271,390 4.46
2014 31,996,794 13,424,901 18,571,893 3,265,000 1,054,878 4,319,878 4.30
2015 31,945,082 13,295,574 18,649,508 1,490,000 920,788 2,410,788 7.74
2016 32,676,182 14,066,527 18,609,655 1,550,000 861,188 2,411,188 7.72
2017 35,053,701 13,843,649 21,210,052 1,550,000 799,188 2,349,188 9.03
Operating expenses less depreciation
Coverage is defined as net revenue available for debt service divided by
debt service requirements
198
CITY OF LANSING, MICHIGAN Table 14- Unaudited
Demographic and Economic Statistics
Last Ten Fiscal Years
Per capita Lansing School
Personal Personal Median District Unemployment Labor
Year Population(') Income Income(') Age(') Enrollment(z) %Rate(3) Force(3)
2008 119,100 $ 2,129,036,285 $ 17,876 32.68 14,475 10.2% 65,833
2009 119,100 2,128,321,923 17,870 32.84 14,482 16.2% 66,822
2010 119,100 2,127,607,561 17,864 32.92 14,098 15.0% 64,074
2011 114,297 2,218,276,176 19,408 30.40 13,465 13.1% 63,130
2012 114,297 2,259,194,502 19,766 32.40 13,236 11.3% 63,374
2013 114,298 2,259,214,268 19,766 32.20 12,544 11.9% 63,181
2014 114,298 2,221,953,120 19,440 32.00 12,088 9.1% 63,102
2015 114,297 2,221,933,680 19,440 32.10 11,587 7.4% 57,432
2016 115,056 2,240,255,376 19,471 32.10 11,112 6.0% 57,633
2017 116,020 2,356,830,280 20,314 32.00 10,962 6.5% 56,668
(1) Source: U.S. Census Bureau
(2) Source: Lansing School District
(3) Source: Michigan Bureau of Labor Market Information and Strategic Initiatives
199
CITY OF LANSING, MICHIGAN Table 15-Unaudited
Principal Employers
Current Year and Nine Years Ago
2017 2008
Percentage Percentage
of Total City of Total City
Employer Employees(') Rank Employment(2) Employees(') Rank Employment
State of Michigan 13,700 1 5.83% 14,355 1 6.52%
Michigan State University 10,725 2 4.56% 10,500 2 4.77%
Liberty National Life Insurance 10,000 3 4.25%
Sparrow Health System 6,000 4 2.55% 6,000 4 2.72%
General Motors 5,027 5 2.14% 6,300 3 2.86%
Auto Owners Insurance 3,400 6 1.45% 1,500 9 0.68%
Meijer 3,000 7 1.28% 2,000 8 0.91%
McClaren Greater Lansing 2,500 8 1.06% 2,500 6 1.13%
Lansing Community College 2,143 9 0.91% 3,180 5 1.44%
John Henry Company 2,100 10 0.89%
Lansing School District 1,553 11 0.66% 2,106 7 0.96%
Peckham, Inc. 1,400 10 0.64%
Greater Lansing metropolitan area employment 235,066
(1) Data is representative of the Greater Lansing Region
(2)Source: Michigan Department of Career Development: Employment Service Agency- Labor Market Information
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201
CITY OF LANSING, MICHIGAN
Full-time Equivalent City Governmental Employees by Function/Program
Last Ten Fiscal Years
Function/Program 2017 2016 2015 2014 2013 2012
General government
City council 10 10 10 10 10 10
Mayor's office 6 6 5 5 5 5
City clerk 5 5 5 5 5 5
54-A district court 45 45 46 43 43 48
City attorney's office 11 11 11 10 10 10
City TV 2 2 2 2 2 2
Internal auditor 1 1 1 1 1 1
Human resources 12 12 10 10 9 9
Information technology 11 11 11 11 10 10
Finance
Accounting/budget/purchasing 8 (9) 8 (9) 9 10 10 13
Treasury/income tax 11 10 9 9 20 10
Assessing 11 11 11 11 11
Property management - - - (6) 18
Fleet management - - - (6) 27
30 29 29 30 30 79
Planning Et neighborhood development
Administration 2 2 2 2 2 2
Code compliance - - - 15 15
Building safety 13 13 13 13 12 13
Planning 4 4 4 4 4 4
Development 9 10 10 11 9 9
Parking Et transportation 14 14 14 15 20 20
42 43 43 45 62 63
Police 240 239 239 234 229 (7) 260
Fire 181 181 181 188 180 179
Code compliance 14 14 14 14
195 195 195 202 180 179
Public services -
Administration Et engineering 20 20 19 19 19 21
Operations Et maintenance 117 117 117 117 120 121
Service garage - - - - - -
Wastewater 41 41 41 41 41 41
Property Management 16 18 18 18 18 (6)
Fleet Management 30 26 27 27 27 (6)
224 222 222 222 225 183
Human relations Et community services 8 7 7 6 5 5
202
Table 16 - Unaudited
2011 2010 2009 2008
11 11 11 11
5 5 5 5
6 7 7 7
50 53 53 53
11 12 12 12
2 2 2 2
1 1 1 1
11 12 13 14
14 15 17 18
14 16 17 16
11 12 13 13
11 12 12 13
20 21 23 24
29 30 31 33
85 91 96 99
2 2 2 2
16 16 16 17
15 15 15 15
5 5 4 5
9 9 10 10
20 40 41 41
66 87 88 90
327 344 342 341
207 218 219 219
207 218 219 219
21 17 18 18
135 110 113 113
41 44 50 50
197 171 181 181
5 5 6 8
continued...
203
CITY OF LANSING, MICHIGAN
Full-time Equivalent City Governmental Employees by Function/Program
Last Ten Fiscal Years
Function/Program 2017 2016 2015 2014 2013 2012
Parks 8t recreation
Administration I* design 6 6 6 6 5 5
Grounds &t forestry - - - - - -
Leisure It special recreation 6 6 6 6 8 10
Cemeteries 1 1 1 1 1 1
Golf/ice arena 3 3 3 3 3 3
Zoo - - - - - -
16 16 16 16 17 19
858 854 852 852 843 888
Source: The City of Lansing, Michigan
In FY 2007, the following restructuring of departments occurred:
(1) A payroll position was transferred from Finance to Human Resources
(2) Operations of the City's three fleet garages was consolidated in Finance
(3) Four custodial positions were transferred from Parks Ft Recreation to Finance
(4) On July 1, 2007, Potter Park Zoo employees were transferred to Ingham County
In FY 2011, the following restructuring of departments occurred:
(5) Grounds Maintenance positions were moved from Parks It Recreation and Planning Et Neighborhood Development and
consolidated with Public Service staff
In FY 2013, the following restructuring of departments occurred:
(6) Fleet and Property Management were moved from the Finance Department to the Public Service Department
(7) On June 27, 2012, 911 Dispatch employees were transferred from the City to Ingham County
In FY 2014, the following restructuring of a department occurred:
(8) Fourteen positions are transferred from PND to Fire; four to Police, and one to Public Service.
In FY 2016, the following restructuring of a department occurred:
(9) Purchasing operations were transferred to the Lansing Board of Water and Light for FY 2016.
204
2011 2010 2009 2008
5 7 7 8
(5) 27 31 32
12 15 19 17
1 3 4 4
4 4 4 4
22 56 65 65
1,020 1,090 1,118 1,126
concluded
205
CITY OF LANSING, MICHIGAN Table 17-Unaudited
Operating Indicators by Function/Program -
Last Ten Fiscal Years
_Action/Program 2017 -it 2015 2014 '--` 2011 ' 2010 ' 2009 i
Public safety
Fire department responses 21,902 21,115 20,170 19,427 18,444 17,093 16,974 16,659 15,852 15,780
EMS related 18,827 18,275 17,376 16,235 15,918 14,851 14,628 14,398 13,447 13,151
Fire related 3,075 2,840 2,794 3,012 2,526 2,242 2,346 2,261 2,405 2,629
Police department responses 82,722 71,468 79,331 76,855 73,087 74,058 78,112 87,724 89,958 87,634
Arrests 5,710 3,880 4,510 5,656 7,196 8,043 8,858 11,644 11,559 12,810
Traffic violations 9,385 7,334 10,781 7,756 14,905 8,829 15,585 18,297 20,122 25,398
Public works
Potholes filled 53,332 53,488 53,281 55,193 33,155 30,116 32,918 24,945 43,601 40,790
Streets resurfaced(miles) 9 9 4 4.60 6.00 5.01 8.99 20.70 16.20 20.92
Recreation
Recreation participation 98,978 101,335 122,639 50,859 55,122 66,836 66,254 70,529 39,060 37,783 '
Pavilion rentals 180 242 206 185 199 198 161 288 315 341
Sewage disposal
Average amount processed
daily(gal) 16.32 million 15.46 million 13.28 million 14.49 million 14.75 million 12.82 million 12.83 million 15.01 million 18.15 million 16.73 million
Parking system
Average number of monthly permit 2,581 3,218 3,077 2,891 2,718 2,735 3,122 3,480 3,783 4,059
Parking tickets issued 33,492 32,990 30,888 34,373 38,127 41,829 45,176 63,610 66,183 57,153
Cemetery
Lots sold 162 115 138 93 113 115 143 142 119 98
Golf
Annual rounds played 14,508 (31 13,325 (31 22,998 22,786 25,554 28,560 26,084 30,936 41,588 z 43,605 z
Garbage and rubbish
Yards sent to landfill 20,007 20,115 19,667 18,829 17,985 18,705 20,334 21,805 29,322 29,869
Recycling
Recycled goods sold(tons) 5,834 5,940 5,691 5,075 3,562 3,149 2,446 2,163 2,591 2,818
Yards composted 24,223 24,413 21,685 25,260 21,832 20,413 15,725 21,819 21,871 21,928
Source: The City of Lansing,Michigan
" The addition of the Southside Community Center,with a pool,resulted in a large increase in recreation participation in FY 2010
Two golf course were closed in FY 2008 with one of those being converted to a driving range
" Groesbeck golf course was closed due to during the months of May-June,2016 for stormwater management course alterations,
206
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207
CITY OF LANSING, MICHIGAN
Capital Assets Statistics by Function/Program
Last Ten Fiscal Years
Function/Program 2017 2016 2015 2014 2013 2012
Public safety
Police stations 2 2 2 2 2 2
Police patrol units 60 60 60 61 60 60
Fire stations 6 6 6 6 6 6
Public works
Streets (miles) 414.00 414.00 414.00 411.00 411.00 407.80
Traffic signals 200 200 200 200 204 204
Recreation
Park acreage 2,134.26 2,134.26 2,363.45 2,364.85 2,364.85 2,434.88
Playgrounds 74 74 72 72 75 73
Baseball/softballfields 25 25 47 61 61 61
Soccer/football fields 15 14 6 6 6 6
Community centers 4 4 4 4 4 4
Sewage disposal
Sanitary sewers (miles) 361 361 361 359 359 359
Storm sewers (miles) 235 235 235 234 234 234
Combined sewers (miles) 188 188 188 188 188 188
Parking system
Ramps 4 4 4 4 4 4
Lots 16 16 17 17 18 15
Meters 2,166 2,166 2,166 2,452 2,452 2,452
Cemetery
Number of cemeteries 3 3 3 3 3 3
Golf
Number of courses 1 1 1 1 1 1
Acreage 115 115 115 115 115 115
Garbage and rubbish
Refuse collection trucks 14 14 17 17 17 19
Recycling
Recycling trucks 5 5 7 7 7 7
Potter park zoo
Number of animals N/A N/A N/A N/A N/A N/A
Source: The City of Lansing, Michigan
(1) Zoo operations were transferred to Ingham County in 2008
(2)Two municipal golf courses were non-operational beginning in 2008
208
Table 18 - Unaudited
2011 2010 2009 2008
3 3 3 3
58 61 61 58
8 9 9 9
410.80 410.63 410.15 410.15
208 203 196 203
2,422.63 2,422.63 2,422.63 2,422.63
71 71 82 82
61 61 61 61
6 6 6 6
4 4 4 4
359 357 354 347.4
234 233 230 225.1
188 191 192 197.4
4 4 4 6
15 16 16 15
2,452 2,493 2,493 2,489
3 3 3 3
1 1 1 1 hl
115 115 115 115 hl
22 18 16 21
9 10 10 10
N/A N/A N/A N/A
209